Market Snapshot | November 24, 2021

Corn futures are weaker at midsession after erasing overnight gains.

• After trading higher earlier, corn fell in step with weakness in wheat futures in generally light trading ahead of the Thanksgiving holiday tomorrow.
• Traders are taking some profits out of the long side of the market in pre-holiday trade.
• USDA reported a daily sale of 100,000 MT corn for delivery to Mexico during the 2021-22 marketing year.
• Weekly ethanol production increased 19,000 barrels per day (bpd) to 1.079 million bpd the week ended Nov. 19. Ethanol stocks increased 83,000 barrels to 20.16 million barrels.
• U.S. ethanol exports are forecast at a record $2.9 billion in fiscal 2022, according to USDA, up $500 million from its August projection. Ethanol is now considered as an agricultural product under the World Trade Organization definition that USDA adopted over the course of 2021.
• December corn futures reached $5.89, the highest intraday price since $5.94 1/4 on Aug. 12, after pushing above a longer-term downtrend line drawn from the May and June highs.

Soybean and soymeal futures are lower after fading from early gains, while soyoil is higher.

• Soybeans are facing pressure from profit-taking and spillover from weakness in soymeal.
• USDA reported a daily sale of 330,000 MT of soybeans for delivery to “unknown destinations” during the 2021-22 marketing year.
• USDA lowered its U.S. ag export forecast for fiscal year 2022, citing weaker soybean demand from China and lower bean prices. The agency said soybean exports were expected to fall $3.9 billion to $28.4 billion, while soybean meal exports were forecast to slump $800 million to $4.9 billion.
• Growing conditions in South America remain mostly favorable, though a drier pattern is expected to develop in some parts of Brazil over the weekend, according to World Weather Inc.
• January soybeans held within the past week’s range as the market waits for further export news. The contract reached a high for the week at $12.81.
• Chart levels to watch in January futures include yesterday’s low at $12.60, along with last week’s low and high at $12.38 and $12.89 1/4, respectively.

Wheat futures are lower at midmorning, being led down by double-digit losses in SRW contracts.

• The wheat market hit a patch of profit-taking this morning, especially in SRW contracts.
• HRW futures earlier extended a rally to nine-year highs amid ongoing supply concerns. March SRW and HRW futures overnight reached contact highs for the third straight day, at $8.74 3/4 and $8.92 1/4, respectively.
• Global supply concerns have intensified this week as excess rains in Australia’s wheat-growing regions raise prospects for lower crop quality.
• Little moisture relief is expected for the dry areas of the western HRW belt during the week ahead, World Weather said.

Cattle futures are higher at mid-morning, with live cattle near three-month highs.

• Live cattle rose for the sixth consecutive session as the cash market extended its run to 4 1/2-year highs. Lower corn prices supported feeder cattle.
• Cash cattle trade started around $136 in the Southern Plains and $137 in the northern market yesterday, though sales volume was light. On average, live steers in top feedlot areas traded yesterday at $134.00, up from last week’s $133.11 average.
• Wholesale beef prices appear to have stabilized after a recent drop under $280.00 in Choice cutout values appear to generate greater retail demand. Choice cutout values fell 61 cents yesterday to an average of $278.64, down from last week’s $280.58 average.
• Slaughter so far this week totaled an estimated 244,000 head, up 1,000 from the same period last week.
• February live cattle rose as high as $140.30, the contract’s highest intraday price since $140.525 on Aug. 25 and just under the contract high of $140.575 posted the previous day.
• Bullish traders have a solid near-term technical advantage with live cattle in a seven-week uptrend on the daily bar chart. Upside price objectives include closing February futures above the contract high in August.

Lean hog futures are mostly higher in nearby contracts, with February reaching a six-week high.

• Nearby hog futures are seeing modest buying from strengthening technicals and ideas the cash market may have established an early seasonal low.
• The CME Lean Hog index has displayed signs of stabilizing. The latest quote rose 27 cents to $73.15, the first increase in five days. The index is around $2.00 under December futures.
• Wholesale pork remains weak but movement this week has been fairly strong, indicating lower prices may be stirring renewed demand.
• Pork cutout values fell $1.33 yesterday to an average of $84.92, near a seven-month low of $84.52 reached last week. Movement was relatively strong at about 325 loads.
• February lean hogs pushed above last week’s high earlier today and climbed to $84.325, the highest intraday price since $85.05 on Oct. 8.to $83.275.
• Chart support is seen around last week’s low at $81.265 and the 100-day moving average around $82.30. Other chart levels to watch include the October high at $87.475.