Market Snapshot | January 22, 2025

Market Snapshot

Pro Farmer's Market Snapshot
Market Snapshot | January 22, 2025
(Pro Farmer)

Hog producers: Exit first-quarter hedges... The cash hog index is showing signs a seasonal low is in place. With February futures trading near the cash index, near-term downside risk is limited. We advise hog producers to exit the 50% first-quarter hedges held in February $84.00 put options.

Corn futures are chopping around unchanged at midmorning.

  • Corn futures earlier edged to a near eight-month high amid global supply concerns as delayed safrinha corn plantings in Brazil are likely.
  • USDA reported daily corn sales of 136,000 MT to unknown destinations for 2024-25.
  • Center-west and center-south Brazil rainfall may increase in frequency and intensity during the first of February, slowing early soybean harvest progress and raising concerns with safrinha corn planting progress.
  • S&P Global Commodity Insights projects U.S. farmers will plant 93.5 million acres of corn in 2025, up 700,000 acres from its December forecast and 2.9 million acres more than last year.
  • March corn futures have extended to a fresh for-the-move high, with resistance remaining at $4.92 3/4. Initial support is around $4.85.

Soybeans are mostly 7 to 9 cents lower. Soymeal futures are around $6.00 firmer, while soyoil is around 140 points lower.

  • Soybean futures are being pressured by profit-taking and heavy selling in soyoil.
  • World Weather Inc. notes Argentina rainfall looks to remain erratic and lighter than usual during much of the next two weeks, especially in east-central and southeastern parts of the nation, which is typical of La Nina environments.
  • Rains in center-west and center-south Brazil will continue to slow harvest progress into at least early February.
  • China has stopped receiving Brazilian soybean shipments from five entities after cargoes did not meet phytosanitary requirements, two sources with direct knowledge of the matter told Reuters. The concerns arose after some cargoes had been found with chemical contamination, pests or insects.
  • S&P Global Insights projects soybean plantings at 83.3 million acres, down 700,000 acres from its December forecast and 3.8 million acres less than 2024.
  • March soybeans are being limited by the 200-day moving average of $10.76 1/2, while initial support is around $10.50.

Wheat futures are 2 to 4 cents higher at midmorning.

  • Winter wheat futures are posting followthrough short-covering gains amid increased production concerns as the U.S. battles frigid temps.
  • Some minor wheat damage may have occurred in a part of the lower Midwest and areas southeast into the Tennessee River Basin, but most of the wheat will survive today’s cold. Some damage may have occurred Monday and Tuesday in the Central Plains, though damage will not be assessed until spring, states World Weather.
  • Overnight, Japan tendered to buy 65,000 MT of feed wheat, while Thailand tendered to buy 195,000 MT of optional origin feed wheat. Jordan tendered to buy up to 120,000 MT of optional origin milling wheat.
  • March SRW futures are tested resistance at $5.66 1/4 while initial support lies at $5.54 1/4.

Live cattle and feeders are sharply higher at midsession.

  • Nearby live cattle are posting strong gains amid technical strenght and support from surging cash cattle prices.
  • Packers are thought to be well positioned on near-term needs, reducing their urgency to actively bid for cattle. Of course, that’s what cash sources indicated last week, too, only to see cash prices jump to another record high. Cash negotiations will likely be pushed deep into the week, which is typical when there is a Cattle on Feed Report.
  • Choice boxed beef values declined $1.11 to $332.05 on Tuesday, while Select rose 11 cents to $319.55
  • February live cattle pushed above multiple layers of resistance to score a contract high at $199.65. Initial support lies around $197.00.

Hog futures are mostly weaker at midmorning.

  • February hog futures are firmer in narrow trade, with looming technical resistance hindering buyer interest.
  • The CME lean hog index is up another 6 cents to $81.46 as of Jan. 20, the seventh straight daily gain. While prices have only risen $1.03 during that span, there are increasing signs a seasonal low is in place.
  • The pork cutout fell $1.49 on Tuesday to $90.82 as all cuts except bellies declined. While the cutout is nearly $3.00 off its January low, prices are tethered in the low-$90.00 area.
  • February lean hogs are trading within Tuesday’s range, with resistance standing at the 100-, 10- and 20-day moving averages, which are trading around $81.90, while support lies at $80.85.