Market Snapshot | February 7, 2024

Corn futures are mostly 2 to 3 cents lower.

• Corn futures dropped to fresh contract lows amid soybean weakness, though emerging wheat strength has eased selling pressure a little.
• Rains of 0.79 to 3.86 inches fell on central areas of Buenos Aires, Argentina over the past two days, the best rainfall for the area since late last year. Other areas of the country remained dry, but World Weather Inc. states two waves of rain will move across the country next week.
• The National Corn Growers Association is urging the Biden administration to prioritize biofuels over electric vehicles EVs to reduce vehicle emissions.
• Ethanol production during the week ended Feb. 2 averaged 1.033 million barrels per day (bpd), up 42,000 bpd (4.2%) from the previous week and 3.3% above the same week last year. Ethanol stocks rose 509,000 barrels to 24.779 million barrels.
• March corn forged a fresh contract low at $4.32 3/4 in early trade, though support at $4.33 1/2 spurred a mild correction. Resistance at the session high of $4.38 3/4 is limiting the upside.

Soybean futures are mostly 6 to 9 cents lower, while March soymeal is around $4.50 lower. March soyoil is around 35 points higher.

• Soybeans have rebounded from earlier lows but continue to face spillover weakness from soymeal. Soyoil futures are notching gains for the third straight session.
• Argentina’s core zone soybean crops are expected to have a 20% to 30% decline in yields in early-sown areas due to last week’s extreme heat, according to the Rosario Grain Exchange.
• Ukrainian soybean exports have risen 17% year-over-year to 1.9 MMT in the first five months of the 2023-24 season amid favorable prices, according to analysts at APK-Inform. The volume is the second highest in Ukraine’s history.
• March soybeans have rebounded from earlier lows but are facing resistance at the 10-day moving average of $12.04 1/2, while support lies at today’s low of $11.79 1/4.

Winter wheat futures are mostly 2 to 5 cents higher, while HRS is near unchanged.

• Wheat futures are extending Tuesday’s short-covering efforts amid U.S. dollar weakness.
• World Weather indicates occasional shower activity is expected in HRW wheat areas, with pockets of precip allowing for a rise in topsoil moisture. Temps will continue to be unusually warm most often, which will further warm the soil and reduce winter hardiness.
• Overnight, Jordan tendered to buy 120,000 MT of optional origin milling wheat, while Bangladesh’s state grain buyer has issued an international tender to purchase 50,000 MT of million wheat.
• March SRW futures have rallied above the 20-, 10- and 100-day moving averages, though resistance now stands at the 40-day moving average of $6.07. Initial support remains at $5.89 1/2.

Live cattle are posting slight losses at midmorning, while feeders are mixed.

• Cattle futures are pausing following Tuesday’s sharp gains to a three-month high, with traders likely waiting for cash trade to develop before committing to the next leg higher.
• Packers are likely to delay cash cattle negotiations as long as possible given negative margins. Feedlots will likely pass on steady/lower prices, despite larger showlists following Tuesday’s surge in cattle futures.
• Choice boxed beef prices rose 59 cents Tuesday to $294.07, while Select gained 83 cents to $284.60, narrowing the Choice/Select spread to $9.47. Movement remained light at 107 loads.
• April live cattle are trading within Tuesday’s upper range, with resistance at the previous session’s high of $186.575, while initial support lies at the 200-day moving average of $184.25.

Lean hogs are posting moderate to strong gains.

• Hog futures are gaining back a portion of recent losses, though overhead resistance is limiting a move higher.
• The CME lean hog index is up another 30 cents to $73.86 as of Feb. 5, extending the seasonal price rise.
• The pork cutout value slid $1.37 lower Tuesday to $86.23, led by a near $6 drop in primal bellies. Movement totaled 360.8 loads.
• April lean hogs have rallied back above the 200-day moving average of $81.79, filling Tuesday’s gap. Resistance is now at the 10-day moving average of $83.28, while initial support is at the previous session’s close of $82.825.