10:30 a.m. Market Snapshot | July 21, 2021

Corn futures are mixed to lower at midsession after rising near three-week highs overnight.

Overnight gains faded amid a lack of market-moving news, but ongoing dryness concerns in key Midwest crop regions continues to underpin corn prices.
A high-pressure ridge may build into the central U.S. July 24-30 before slowly shifting to the west, leading to net drying for some of the western Corn Belt, according to World Weather Inc.
Concern over U.S. crops “will remain, with accelerated drying and rising crop stress from the northern Plains and upper Midwest into a larger part of the western Corn Belt during the next two weeks,” World Weather said.
China will auction another 23,488 MT of corn imported from Ukraine on July 23, the country’s grain stockpiler Sinograin said today. The auctions, which began in June, were initially met with strong demand, but sales nosedived this month.
December futures reached $5.73 overnight, the highest intraday price since July 2 and 1/2 cent from filling a 21-cent gap stemming from a post-July 4 selloff. A close above $5.73 1/2 may lead to a test of this month’s high at $6.11 1/4, based on chart patterns.

Soybean and soyoil futures are lower, while soymeal futures are higher.

Soybean futures faded from overnight gains in step with the soyoil market, which is under pressure after Argentina approved a law to reduce the amount of soyoil blended in its biodiesel.
Argentina’s new law will lead to an increase in the country’s soyoil exports and pressure international prices, industry officials said earlier this week, according to Reuters.
Soyoil also bears watching after the Biden administration delayed its annual rulemaking process regarding its biofuel blending mandates under the Renewable Fuel Standard (RFS) for 2021.
Persistent dryness in top U.S. soybean states remains a concern as the crop nears critical growth stages in August.
Warmer temperatures and infrequent rain the next two weeks “will lead to significant drying in much of the Midwest and stress to crops will increase from the eastern Dakotas and northeastern Nebraska into Minnesota and northern Iowa where yield potentials should decline,” World Weather said.
November rose overnight as high as $13.97 before falling as low as $13.75, still within this week’s range. Technicals have held firm, with November trading above most major moving averages. Chart levels to watch include Monday’s high of $14.18.

HRW and SRW futures are on track for a sixth consecutive daily gain as U.S. harvest pressure winds down and demand prospects improve amid crop concerns in other top wheat countries.
Spring wheat is under pressure, but not far removed from contract highs as severe dryness in the Northern Plains cuts harvest prospects.
“No relief is expected in Canada’s Prairies and the U.S. northern Plains will see a new round of declining crop conditions over the next week to nearly 10 days,” World Weather said in a report today.
September SRW wheat rose to $7.10 overnight after yesterday touching $7.18, the highest intraday price since $7.32 1/4 on May 13.
Agriculture and Agri-Food Canada (AAFC) raised its all-wheat yield forecast, with the 2021-22 crop now estimated at 31.428 MMT. “Downward pressure on yields is possible as drought persists in most of the Prairies,” AAFC wrote.
USDA earlier this month trimmed its Canadian wheat crop forecast by 500,000 MT to 31.50 MMT. Both are well above private crop estimates.
Russia exported about 37.6 MMT of wheat in 2020-21, enough for the country to maintain its position as the world’s biggest wheat exporter, an agricultural official said.

Live cattle have reversed early losses to trade steady to slightly higher. Feeder cattle are moderately higher.

Lackluster cash market action and slumping beef prices initially pressured live cattle futures, while feeders are seeing a modest boost from weaker corn prices earlier today.
Plains cash trading was at a standstill earlier this week amid light demand, USDA reported. There were some sales in Iowa at $122, compared to $125 at auctions last week.
Choice boxed beef values fell $1.61 yesterday to $264.88, a 3 1/2-month low, according to USDA data.
USDA reports later this week will help set longer-term direction for cattle markets; upcoming reports include monthly Cold Storage on Thursday and Cattle on Feed and Cattle Inventory Reports Friday.
June placements are expected to drop about 4.1% from the same month a year earlier, based on the average analyst estimate.

Lean hog futures are slightly to moderately higher, with October contracts at a one-month high.

August lean hog futures remain at a discount to the CME lean hog index, which climbed to $112.26, its highest since June 28.
Cash hog bids jumped yesterday, with the national average rising $3.60 to $109.84, while pork cutout values slipped $1.51 though pork movement picked up to 340.36 loads.
Average hog weights in the Iowa/southern Minnesota/South Dakota market dipped 0.1 lb. the week ending July 17 to 278.1 lbs., which is 4.2 lbs. under year-ago.
Packer profit margins have strengthened notably over the past week, with HedgersEdge.com pegging them at $16.10 a head as of Tuesday.
Chart levels to watch include $106.80, last week’s high in August hogs, and the 100-day moving average around $104.50, as well as last week’s low, $102.10.

Tags