Market Snapshot | September 20, 2022

Corn futures are 12 to 14 cents higher at midsession.

• December corn rose a second straight day on spillover from strong gains in the wheat market.
• USDA late Monday reported 7% of the U.S. crop was harvested as of Sunday, up from 5% a week earlier but slightly behind the 8% average for the previous five years. Harvest progress also fell short of expectations for about 10%.
• USDA rated 52% of the crop “good” or “excellent,” down from 53% last week. When USDA’s weekly condition ratings are plugged into the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500-point scale, with 500 representing perfect), the corn crop dropped 3.3 points to 336.9, the 10th straight weekly decline.
• Crop consultant Dr. Michael Cordonnier lowered his U.S. corn yield estimate by 1 bu. to 169 bu. per acre, noting a hot, dry end to the growing season across areas of the Corn Belt. He reduced his production forecast to 13.60 billion bu. from 13.94 billion bu.
• December corn rebounded after dropping under the 10-day moving average at $6.81 3/4 overnight and rose as high as $6.92 3/4. Further strength may have bulls targeting a 2 1/2-month high at $6.99 1/2 posted Sept. 12.

Soy complex futures are higher, led by gains of more than $9 in nearby soymeal and 17 to 21 cents in nearby soybeans; nearby soyoil is up 50-plus points.

• Soybean futures erased overnight declines and climbed to gains with support from sharp gains in wheat and strength in corn.
• Cordonnier lowered his U.S. soybean yield estimate by 0.5 bu. to 50.0 bu. per acre, which dropped his production estimate to 4.33 billion bu. from 4.38 billion bu.
• USDA reported 3% of the U.S. soybean crop was harvested as of Sunday, short of both the 5% five-year average and analyst expectations, also 5%.
• The crop was rated 55% “good” or “excellent,” down from 56% last week. Based on the Pro Farmer CCI, the soybean crop fell 3.3 points to 338.9, the seventh consecutive weekly decline.
• China’s soybean imports from Brazil plunged in August from a year ago, customs data showed, as high prices capped purchases. Imports from the U.S. increased. China, the world's biggest soybean buyer, imported 6.25 MMT of soybeans from Brazil in August, down from 9.04 MMT a year earlier.
• November soybeans held support just above the 100-day moving average at $14.48 3/4 and rallied as high as $14.74 3/4 by midsession.

Wheat futures are up sharply, led by gains of 34 to 40 cents in HRW and SRW contracts.

• Winter wheat futures surged in a corrective bounce from Monday’s losses, as traders shrugged off strength in the U.S. dollar and weakness in crude oil.
• News four regions in Ukraine have requested referendums to break away and join Russia has sparked renewed global grain supply concerns.
• USDA late Monday said 21% of the winter wheat crop was planted as of Sunday, up from 10% a week earlier and ahead of the five-year average of 17%. Analysts expected a planting to be about 20% complete. The spring wheat crop was 94% harvested, up from 91% the previous week.
• Dry weather is expected for the southern U.S. from Texas through the Delta into the Southeast the coming week, favoring crop maturation and harvest progress, World Weather Inc. said. Some winter wheat areas in Nebraska, northern Kansas and northeastern Colorado will benefit from rain Wednesday and Thursday.
• Ukrainian farms in all government-controlled regions have started sowing winter wheat for the 2023 harvest, seeding 364,000 hectares, or 9% of the expected area, the agriculture ministry said today.
• December SRW wheat climbed above its 40-day moving average and rose as high as $8.72. Further strength may have bulls targeting a two-month intraday high at $8.84 3/4 posted Sept. 15.

Live cattle futures are higher at midmorning, while feeder cattle are lower.

• Live cattle futures rose to five-month highs on followthrough from Monday’s firm close and expectations for continued strength in cash prices.
• Feeder cattle are under pressure from strength in corn futures.
• Live steers last week averaged $143.19, up 71 cents from the previous week, and traders expect further gains, though trade likely won’t be established until later this week.
• Wholesale beef remains under pressure but demand has been firm. Choice beef cutout values rose 5 cents Monday to $252.45, near a 17-month low posted last week. Boxed beef movement last week totaled 3,791 loads, the highest weekly total since mid-July.
• October live cattle reached $146.775, the highest intraday price since the contract high of $147.50 posted April 22.

Hog futures are mostly lower, with nearby contracts under pressure.

• October hogs faded from an initial climb to a one-month high, but the rebounding cash index should limit weakness.
• The CME lean hog index is up 45 cents to $98.42 (as of Sept. 16). Traders are likely to maintain a slight discount in the lead contract as any upturn in the cash index is likely to be temporary before seasonal pressure resumes.
• Pork cutout values fell 51 cents to $105.88, down from a four-week high. Movement was strong at 347 loads.  
• October lean hogs rose as high as $97.45, the contract’s highest intraday price since $97.525 on Aug. 18, before fading.