Market Snapshot | August 11, 2022

Corn futures are 7 to 8 cents higher at midsession.

• Corn futures rose for a third consecutive session to near a two-week high as weather concerns and U.S. dollar weakness drove buyer interest. Traders await USDA’s Crop Production and Supply and Demand Reports Friday.
• USDA’s first survey-based estimates are expected to come in lower than its July projections. Based on a Reuters survey of analysts, corn production is expected at 14.392 billion bu., down from USDA’s July projection of 14.505 billion bushels.
• USDA reported net weekly U.S. corn sales at 191,800 MT for 2021-22, up from 57,900 MT the previous week. For 2022-23, net sales totaled 191,300 MT, down from 256,700 MT the previous week. Both figures were at the low end of trade expectations.
• Conab lowered its forecast for Brazil’s corn crop to 114.7 MMT, down 972,000 MT from last month, and kept its 2021-22 export estimate unchanged at 37.5 MMT.
• Consultancy Strategie Grains slashed its European Union corn production forecast by 10 MMT to a 15-year low of 55.4 MMT due to severe drought across Europe.
• The Rosario Grain Exchange expects Argentina’s corn planted area to fall by 4.7% to 8 million hectares for 2022-23, while soybean acres are anticipated to rise by 4.3% to 16.8 million acres. The exchange projects 2022-23 production at 55 MMT for corn.
• December corn futures rose to $6.28 1/4, topping Wednesday’s high by 1/4 cent to reach the highest intraday price since July 29.

Soy complex futures are broadly higher, with November soybeans up around 18 cents, September soymeal up nearly $8 and September soyoil up more than 100 points.

• Soybeans resumed the rally of the past two weeks amid concerns persistent dryness will curtail yield prospects. USDA’s first survey-based crop estimate in Friday’s reports is expected to be lower than the July projection.
• The soybean crop is expected to come in at 4.481 billion bu., based on a Reuters survey of analysts, down from USDA’s July projection of 4.505 billion bushels. The average U.S. yield is expected at 51.1 bu. per acre, down 0.4 bushels.
• USDA reported net weekly soybean sales reductions of 66,700 MT for 2021-22. For 2022-23, net sales totaled 477,200 MT, primarily for China (195,000 MT) and “unknown destinations” (184,200 MT). Both figures were within trade expectations. USDA has reported net old-crop sales reductions in six of the past seven weeks.
• USDA reported a daily sale of 103,400 MT of soybean meal for delivery to Mexico during the 2022-23 marketing year.
• Conab kept its soybean production and export forecasts unchanged at 124.0 MMT and 75.2 MMT, respectively.
• The Rosario Grain Exchange expects Argentina’s soybean acres to rise by 4.3% to 16.8 million acres, citing producers’ preference for soybean production given “not very encouraging weather forecasts and high possibilities” of La Niña. The exchange projects 2022-23 production at 47 MMT for soybeans.
• November soybeans reached $14.53, just under Wednesday’s high at $14.54 3/4 and close to the 100-day moving average at $14.63 1/2.

Wheat futures are posting gains of 10 to 14 cents at midmorning.

• Wheat futures rose to the highest levels in over a week behind spillover from gains in corn and soybean markets, stronger technicals and weakness in the U.S. dollar.
• The first shipments of wheat should start flowing from Ukrainian ports next week under the new export deal, a top UN official said Wednesday. The first 12 shipments that have left three Black Sea ports designated by the deal were carrying corn or oilseed products.
• USDA reported net weekly U.S. wheat sales of 359,200 MT for 2022-23, up 44% from the previous week but down 34% from the prior four-week average. 
• September SRW wheat rose to $8.20 3/4, the contract’s highest intraday price since July 29.

Live cattle futures are firmer at midmorning while feeder cattle are mostly lower.

• Live cattle futures extended Wednesday’s gains to near four-month highs behind expectations for stronger cash prices and signs of solid beef demand.
• Cash cattle sales were light through Wednesday, though the limited trade that did occur was around $1 higher in the northern live market and $2 to $3 higher for the dressed market. Cash sources didn’t indicate any activity in the Southern Plains, though the initial sales up north suggested prices will rise.
• Choice beef cutout values fell $1.50 Wednesday to $263.23 but movement was again solid at 123 loads.
• USDA reported net U.S. beef sales of 14,600 MT for 2022, up 22% from the previous week but down 17% from the prior four-week average. 
• October live cattle reached $145.225, the contract’s highest intraday price since the contract high of $147.50 on April 22.

Hog futures are mildly higher.

• October lean hog futures rose to a contract high for the second straight day on bullish technicals and firm cash fundamentals.
• The CME lean hog index has turned choppy recently but the long-term trend remains higher. The index is down 16 cents today (as of Aug. 9) to $122.09. October futures have closed the gap with the index but remain at a steep discount.
• Pork cutout values fell 18 cents Wednesday to $123.67, but movement was strong at 302 loads.
• USDA reported net U.S. pork sales of 21,500 MT for 2022, down 31% from the previous week and down 6% from the prior four-week average. 
• October lean hogs reached a contract high at $101.65.