Market Snapshot | June 9, 2022

Corn futures are higher at midmorning, led by a gain of about 16 cents in the July contract.

• July corn rose for the fourth straight day and posted a two-week high as the market extended a weeklong technical resurgence, supported by a rally in soybeans.
• Corn rallied despite sluggish weekly export readings. USDA reported net U.S. corn sales of 280,400 MT for 2021-22 for the week ended June 2, up 51% from the previous week and up 19% from the average for the previous four weeks. For 2022-23, net sales of 73,500 MT, including 58,300 MT for “unknown destinations,” were up from last week’s 48,700 MT.
• USDA in its monthly Supply and Demand update Friday is expected to slightly reduce its estimate for U.S. corn ending stocks for 2021-22 and 2022-23.
• July corn reached $7.81 3/4 soon after the open of daytime trade, the contract’s highest intraday price since $7.87 1/4 on May 24. Initial resistance is seen just above today’s high at the 40-day moving average (currently $7.82 1/4), which July hasn’t traded above in over two weeks.

Soy complex futures are mixed, with nearby soybeans up around 35 cents and nearby soymeal up about $12, while soyoil is lower.

• Nearby soybeans rose for a fourth consecutive session and neared a 10-year high on fresh export demand and concerns over delayed planting in the northern Midwest.
• USDA reported a daily sale of 143,000 MT of soybeans for delivery to “unknown destinations,” including 500 MT for 2021-22 marketing year and 142,500 MT for 2022-23. The announcement marked the first USDA-reported soybean sales since June 2.
• Net weekly U.S. soybean sales totaled 429,900 MT for 2021-22, nearly quadruple the previous week’s 111,600 MT tally and up 41% from the prior four-week average. Top buyers included China (128,900 MT, including decreases of 10,900 MT). For 2022-23, net soybean sales totaled 595,300 MT, with top buyers including Pakistan (297,000 MT) and China (261,000 MT). Both old-crop and new-crop sales were on the high end of expectations, which ranged from 100,000 to 500,000 MT and 200,000 to 700,000 MT, respectively.
• Malaysian palm oil futures fell sharply after top producer Indonesia began an effort to accelerate exports and key buyer China re-imposed Covid-19 lockdowns in Shanghai.
• July soybeans posed a contract high at $17.81 1/2, surpassing Wednesday’s high and the highest intraday price for a nearby contract since September 2012. Upside targets include the all-time high of $17.94 3/4, also posted in September 2012.

Wheat futures are 6 to 10 cents lower at midmorning across all three markets.

• Wheat futures are under mild pressure as the market monitored talks over a potential re-opening of grain shipments from Ukraine.
• The Kremlin said no agreement had been reached with Turkey on exporting Ukrainian grain shipments across the Black Sea, though talks continued. Turkey has been pushing for an agreement between Russia and Ukraine on a plan to resume grain exports from Ukrainian ports, though prospects for a deal appear dim with both sides blaming the other for the stoppage.
• Net weekly wheat sales totaled 451,000 MT for 2022-23, which began June 1, with unknown destinations the leading buyer at 117,600 MT. Sales were at the high end of trade expectations ranging from 250,000 to 500,000 MT.
• Accumulated U.S. exports for the 2021-22 marketing year that ended May 31 totaled 18.7 MT, down 25% from the prior year’s total of 24.8 MMT.
• Argentina’s 2022-23 wheat crop will likely come in at 18.5 MMT, down from 19 MMT previously estimated, the Rosario Grain Exchange forecast, citing reduced planting by farmers due to dry weather. The exchange cut its forecast for planted area to 6.2 million hectares, the lowest in 12 years.
• Japan purchased 146,990 MT of wheat in its weekly tender, including 88,483 U.S. and 58,507 MT Canadian.

Live cattle and feeder cattle are mostly firmer at midmorning.

• Live cattle futures modestly extended Wednesday’s rally to six-week highs amid signs the cash market is firming following a four-week slide.
• Cash cattle trade started around $136 in the Southern Plains and $141 in Nebraska Wednesday, up about $1 from last week in both locations. The firmer tone prompted most feedlots held out for even higher prices.
• Strength in wholesale beef is also supportive to futures. Choice cutout values gained 32 cents Wednesday to $271.74, the highest daily average since April 15. Movement was a relatively strong 121 loads.
• USDA reported net weekly U.S. beef sales of 17,700 MT for 2022, down 1% from the previous week but up 21% from the prior four-week average. 
• August live cattle reached $137.95, slightly above Wednesday’s high, but generated little following buying interest.

Hog futures are sharply lower at midmorning.

• Lean hogs futures extended Wednesday’s downturn and fell near three-week lows amid ideas a recent surge in the cash market has run its course.
• The CME lean hog index fell 32 cents to $107.48 (as of June 7), halting a nearly uninterrupted climb since the end of May. With summer-month contracts at a discount to the cash index, traders appear to believe the cash market has peaked.
• Pork cutout values plunged $3.36 Wednesday to $104.47, near a three-week low and driven by a drop of nearly $28 in bellies. Movement was light at 268 loads.
• Net weekly U.S. pork sales totaled 16,700 MT for 2022, down 48% from the previous week and down 44% from the prior four-week average.