10:30 Market Snapshot | December 18, 2023

Corn futures are trading mostly 3 to 4 cents lower at midmorning.

• Corn futures are extending losses at midmorning. Wheat is weighing on corn, while strength in the soybean market is failing to provide meaningful support.
• Drought in central Brazil is causing farmers to delay fertilizer purchases for the safrinha corn-planting season, executives told Reuters. As of early December, farmers had purchased only 60% of their estimated fertilizer needs in the safrinha corn-producing states of Parana and Mato Grosso do Sul, compared with the normal 80% at this time of year.
• USDA reported corn export inspections of 947,418 MT (37.3 million bu.) for the week ended Dec. 14. That was up 222,088 MT from the previous week and near the top end of pre-report expectations ranging from 550,000 to 950,000 MT.   
• China imported a record 3.59 MMT of corn during November, customs data showed, despite this year’s record domestic crop. The November import volumes were higher than expected, mainly because of quick loading from Brazil and some from Ukraine. In the first 11 months of this year, China’s corn imports totaled 22.18 MMT, up 12.3% from the same period last year.
• March corn futures continue to chop in the sideways trading range marked by last month’s low and high at $4.70 1/2 and $4.96 1/2, respectively. However, bears have the upper hand, with the contract trading below the short-, intermediate and long-term moving averages.

Soybeans are mostly 1 to 2 cents higher, while January meal futures are nearly $5.00 higher. January soyoil futures are modestly higher.

• Soybean futures have rebounded from earlier weakness as the soy complex is broadly higher.
• The hot and dry conditions that stressed crops in central and northeastern Brazil during the weekend will continue early this week, according to World Weather Inc. Rains and cooler temps are expected to move into these areas of the country by midweek and continue periodically over the next 10 days.
• Brazil’s soybean planting reached 94% done as of last Thursday, according to AgRural.
• USDA reported soybean export inspections of 1.412 MMT (51.9 million bu.), up 411,777 MT from the previous week and near the top end of pre-report expectations ranging from 750,000 MT to 1.5 MMT.
• USDA did not report any daily soybean sales, snapping an eight-day string in which China or “unknown destinations” were a buyer of U.S. soybeans.
• January soybeans continue to pivot around the 10-day moving average, which is currently near $13.12 3/4. Near-term support extends from $13.02 1/2 to $12.92. Near-term resistance is in the $13.28 to $13.34 range.

Winter wheat futures are 4 to 5 cents lower, while HRS futures are mostly 3 to 5 cents lower.

• Wheat futures are facing solid pressure from forecasts calling for more beneficial rains across U.S. winter wheat areas.
• Recent rains helped recharge soil moisture in areas of the Southern Plains and some of the Midwest. More rains are expected across HRW and SRW wheat areas of the central U.S. late this week through Christmas, according to World Weather.
• USDA reported wheat export inspections of 284,792 MT (10.5 million bu.), down 32,364 MT from the previous week. That was near the middle of pre-report expectations ranging from 200,000 to 400,000 MT.
• March SRW futures dropped below the 10-day moving average around $6.24 1/2. Support is in the $6.20 to $6.02 1/2 range. Near-term resistance extends from $6.32 to $6.49 1/2.

Live cattle are posting moderate to strong gains at midmorning, while feeders are sharply higher.

• Cattle futures are extending last week’s corrective gains.
• While futures have seemingly forged a bottom, the cash market remains in search of a low. Cash prices fell for a sixth consecutive week last week.
• Wholesale beef prices were mixed on Friday, as Choice fell 68 cents to $291.64 and Select rose $2.56 to $260.82.
• February live cattle gapped above the 20-day moving average around $169.69. The gap was filled, but support at the 20-day average is intact. Today’s high at $171.00 is initial resistance.

Lean hogs are mixed amid choppy trade at midsession.

• Lean hog futures are choppy as traders waiting on signs of a seasonal low in the cash market.
• The CME lean hog index is down another 60 cents to $67.15 (as of Dec. 14) and now $14.73 below last year at this time. February hogs hold around a $4.50 premium to the cash index, suggesting traders sense a seasonal low will come in early 2024.  
• Wholesale pork prices rose 76 cents to $84.33 Friday.
• China imported 90,000 MT of pork during November, unchanged from the previous month but 48.1% less than last year. During the first 11 months of this year, China imported 1.46 MMT of pork, down 6.3% from the same period last year.
• February lean hogs are pivoting around initial resistance at $72.00, with additional resistance at the 40-day moving average near $72.125 and the 50-day average at $72.535. Support is in the $71.00 to $69.175 area.