Market Snapshot | October 26, 2023

Corn is steady to fractionally higher at midmorning.

• Corn futures have pulled back from earlier highs amid weakness in the soy complex and negative outside markets.
• USDA reported net corn sales of 1.351 MMT during week ended Oct. 19, which were up 53% from the previous week and 22% above the four-week average. Mexico was the top buyer at 762,400 MT. Sales topped pre-report expectations of 600,000 MT to 1.2 MMT.
• Argentina’s weather has improved from absolute dryness earlier this month and planting prospects are improving, according to World Weather.
• Harvest weather in the U.S. is deteriorating due to increasing rain coverage and amounts.
• December corn is trading within Wednesday’s range, with the 40-day moving average of $4.85 1/4 serving as resistance, while support lies at $4.75 3/4.

Soybeans are 6 to 7 cents lower, while December meal futures are around $1.00 lower. December soyoil is around 50 points lower.

• Soybeans have seen earlier gains evaporate, despite supportive demand news.
• USDA reported a daily soybean sale of 110,000 MT to China for delivery during 2023-24.
• USDA reported net soybean sales of 1.378 MMT during week ended Oct. 19, a marketing-year high and 43% above the four-week average. China purchased 1.167 MMT, including 776,000 MT switched from unknown destinations and decreases of 142,200 MT. Traders expected sales to range from 750,000 MT to 1.5 MMT.
• World Weather Inc. reports the European forecast model has increased rainfall in center-west Brazil again late in the coming seven-day period, especially during the second weekend of the two-week forecast. However, the forecaster believes the increase was overdone. The GFS (American) model continues to downplay rainfall in the region over the next ten days.
• As many as eight to 10 cargoes of Brazilian beans for November shipment to China may have been “washed out” or canceled by some major global grain firms, several market sources told Agricensus today. The rumor came as Brazilian beans for November shipment have been slightly less competitive than sales out of the U.S. Gulf.
• Malaysian palm oil futures extended gains overnight, led by strength in rival edible oils and a softer ringgit, though lackluster exports and weaker crude oil prices limited gains.
• November soybeans are trading mostly between the 20-day moving average of $12.84 and the 10-day moving average of $12.95 1/2. Additional support and resistance are at $13.00 1/4 and $12.77, respectively.

Winter wheat contracts are mostly 4 to 6 cents higher, while HRS contracts are mostly a nickel higher.

• Wheat futures have regained a portion of Wednesday’s losses, though overhead resistance and U.S. dollar strength is limiting gains.
• Wheat export sales totaled 363,700 MT during week ended Oct. 19, which were down 43% from the previous week and 31% from the four-week average. China bought 65,000 MT of U.S. wheat on the week. Traders expected sales to range from 300,000 to 600,000 MT.
• Ukraine has suspended the use of its new Black Sea grain corridor due to what it sees as a threat from Russian warplanes, Kyiv-based Barva Invest consultancy said. The consultancy said a de facto suspension had already been in place for two days at the request of the military, which cited a threat from increased Russian military aviation activity in the area.
• The overnight frost in southeast Australia should have a low impact on crops, according to World Weather. The forecaster stated, “most of the wheat and barley should not have been seriously impacted since most temperatures stayed above freezing.”
• December SRW futures pushed above the 20-day moving average of $5.72 and are hovering just below the 10- and 40-day moving averages of $5.80 and $5.81 1/2, respectively, which are serving as resistance. Initial support lies at $5.61 1/2.

Live cattle and feeders are mixed at midmorning.

• Nearby live cattle futures are working higher in an attempt to regain more of Monday’s losses.
• USDA’s Cold Storage Report Wednesday afternoon showed beef stocks at the end of September totaled 420.2 million lbs., up 24.8 million lbs. (6.3%) from August, which was greater than the five-year average increase of 11.1 million lbs. during the month. However, beef inventories dropped 105.9 million lbs. (20.1%) from year-ago and were 60.7 million lbs. (12.6%) below the five-year average.
• Choice boxed beef prices rose $1.52 Wednesday to $307.50, which is $10.74 off the Oct. 4 low. Select dropped $2.34 to $281.66, which is also off the earlier fall low.
• December live cattle are being limited by resistance at $180.17, while initial support is at Wednesday’s close of $179.425. 

Lean hogs are posting moderate- to strong gains at midsession.

• Lean hog futures are extending Wednesday’s strong gains despite continued seasonal cash market pressure.
• USDA’s Cold Storage Report showed pork stocks at 462.8 million lbs., down 6.5 million lbs. (1.4%) from August, compared to the average over the past five-years of a 3.0-million-lb. increase during September. Pork stocks fell 74.3 million lbs. (13.8%) from last year and were 69.4 million lbs. (13.0%) lower than the five-year average.
• The CME lean hog index is down another 26 cents to $78.41 as of Oct. 24, extending the recent seasonal slide.
• The pork cutout value rose $1.00 Wednesday to $87.59 amid a $7.36 gain in primal bellies. Movement totaled 299.3 loads.
• China’s sow herd at the end of September totaled 42.4 million head, down 2.8% from last year, the ag ministry said. The pig herd dropped 0.4% to 44.23 million head.
• December lean hogs pushed above Wednesday’s high but are facing resistance at $68.525. The 10-day moving average just under $67.00 is serving as initial support.