Market Snapshot | November 19, 2021

Corn futures are near unchanged at mid-morning after trimming overnight losses.

Futures pushed to lows for the week overnight amid corrective selling but have bounced back with spillover from strength in the wheat market.
U.S. harvest is largely complete and traders are looking to exports and other markets for direction. Strong demand from domestic ethanol producers is underpinning futures and exports have picked up recently, reaching a marketing-year high the week of Nov. 11, USDA reported.
December futures are on track to close below last week’s close at $5.77 1/4 after failing to push meaningfully above a long-term downtrend line drawn from the May and July highs earlier this week.
Still, market bulls still have a near-term technical advantage with a five-week price uptrend intact on the daily bar chart. The next upside price objective for the bulls is to close December prices above solid resistance at $6.00.
Other chart levels to watch include the November high at $5.86 and the August high at $5.94 1/4, along with today’s and this week’s low at $5.68.

Soybean and soymeal futures are up slightly, while soyoil futures are weaker.

January soybeans have recovered from overnight declines and are poised to end higher for the second consecutive week, supported by signs of stronger export demand.
USDA reported no new soybean export sales today or yesterday, but the previous four trading days saw sales announcements totaling 814,000 MT to China and “unknown destinations.”
Weather in South American remains mostly favorable for crop development. Much of Brazil will see regular rounds of rain the next two weeks, World Weather Inc. said today. Traders will watch forecasts calling for hotter temps in Argentina where rains have been more uneven.
January soybeans fell as low as $12.57 overnight but are up from $12.44 1/4 at the end of last week. The most-active contact reached a seven-week high at $12.89 1/4 Nov. 17 and broke above a downtrend line drawn from the May and July highs.
Upside targets for market bulls include closing January futures above solid resistance at $13.00.

Wheat futures are higher, led by HRW, after recovering from overnight weakness.

Winter wheat futures’ morning rebound puts the markets on track for a second straight week of gains, supported by the shrinking global supply outlook.
Wet conditions in Australia have emerged as a potential stumbling block to an expected large harvest.
In the U.S. HRW belt, a potential weather disturbance may bring precipitation around the middle of next week, with amounts expected to be greatest in southeastern areas, World Weather said. Some rain and snow may fall in the west as well.
December SRW futures fell as low as $8.13 1/2 overnight but held within this week’s range and are up from $8.17 at the end of last week. March SRW futures hit a contract high at $8.54 yesterday, while March HRW futures hit a contract high at $8.53 1/4.

Live cattle futures are near unchanged, while feeder cattle are mildly lower.

Live cattle futures climbed to the highest levels in almost two weeks amid continued cash market strength, while an upturn in corn weighed on feeder cattle.
Cash cattle traded another $2 to $3 higher this week, building on the 4 1/2-year highs posted last week. Packers aim to fill out aggressive slaughter schedules over the next month amid a tightening supply of market-ready animals.
USDA’s monthly Cattle on Feed Report after today’s close is expected to show feedlot placements in October up 2.2% from the same month in 2020, based on a Reuters survey. The number of cattle on feed as of Nov. 1 is expected to decline about 0.2%, while October marketings are expected to be down 3.7%.
Choice cutout values fell $2.31 yesterday to $276.16, the lowest since $275.22 on July 29. Select grade fell 90 cents to$263.16 and overall movement totaled 193 loads.
February futures rose as high as $137.65, the highest intraday price since $137.675 on Nov. 8, and are up from last week’s close at $136. 10.

Lean hog futures are mostly lower at midmorning.

Hog futures pushed briefly to six-week highs but saw little sustained buying interest with cash fundamentals continuing to sag. Still, deferred futures are up sharply on the week amid longer-term prospects for smaller animal supplies.
Today’s CME Lean Hog Index is down $1.02 to $75.26, the lowest since Feb. 12. December futures are trading in-line with the cash index, meaning lead-month contract should shadow daily movement in the cash market for the next three weeks.
Pork cutout values jumped $5.17 yesterday to an average of $89.69, propelled by a surge of $22.51 in primal ham. Carcass values on national direct markets fell $1.20 to $55.10.
February futures rose as high as $83.725, the highest intraday price since $85.05 on Oct. 8, and are up from $80.55 at the end of last week.

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