Market Snapshot | September 27, 2022

Corn futures are 4 to 6 cents higher at midsession.

• Corn futures are higher in corrective buying across the grain and soy complex following Monday’s sharp declines. Outside markets are price-supportive today.
• Slower-than-expected harvest is also helping support prices. USDA late Monday reported the U.S. corn harvest at 12% complete as of Sunday, up from 5% from a week earlier but slightly under trade expectations for 13%. The crop was rated 52% “good” to “excellent,” unchanged from the previous 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 1.8 points to 335.2, the 11th straight weekly decline and 25.7 points under the five-year average.
• Farmers are among the Russians being drafted into the military, President Vladimir Putin told a meeting with officials today, signaling potential risks for the 2023 crop, Reuters reported.
• Hurricane Ian, currently a Category Three storm, was over western Cuba this morning and is expected to intensify to a Category Four storm today over the southeastern Gulf of Mexico.
• A total of 231 ships carrying 5.3 MMT of agricultural products, including nine vessels with 345,3000 MT that departed today, have left three Ukrainian Black Sea ports since Aug. 1 when the grain export deal started.
• South Korea purchased 137,000 MT of corn expected to be sourced from South America or South African and 68,000 MT of South American corn.
• December corn fell as low as $6.66 1/4 overnight, 3/4 cent above Monday’s low, before climbing. Key downside chart levels include $6.62, trendline support drawn from the July low.

Soy complex futures are mixed, with soybeans up 9 to 10 cents and December soyoil up around 60 points, while December soymeal is down around $2.

• Soybean futures joined a corrective recovery in grain markets, with additional support from gains of more than $2 in crude oil.
• USDA reported the U.S. soybean harvest at 8% complete as of Sunday, up from 3% a week earlier but behind the 13% average for the past five years. Analysts expected harvest to be 11% complete. USDA rated 55% of the crop in “good” to “excellent,” unchanged from last week.
• Based on the Pro Farmer CCI, the soybean crop slipped 0.7 point to 338.2, the eighth straight weekly decline and 15.0 points under the five-year average.
• November soybeans fell as low as $14.10 1/4 overnight, 2 cents above Monday’s low and near trendline support around $14.05, before rebounding.

Wheat futures are higher, led by gains of 22 to 25 in HRW and SRW contracts.

• Wheat futures are higher on corrective buying following Monday’s declines. The U.S. dollar index is mildly weaker this morning, which is helping encourage corrective buying in wheat, though the greenback remains near 20-year highs.
• USDA said the U.S. winter wheat crop was 31% planted at the start of the week, up from 21% a week earlier and slightly ahead of the 30% five-year average, USDA reported. Analysts expected planting to be about 33% complete.
• Farms in regions controlled by the Ukrainian government have sown 622,000 hectares to winter wheat for the 2023 harvest, or 16% of the expected area, the agriculture ministry said today.
• China will auction 40,000 MT of wheat from state-owned reserves on Oct. 12. The sale will include wheat from the 2014 crop offered at 2,410 yuan (around $336) per MT and wheat from the 2015, 2016 and 2017 crops at 2,500 yuan (around $348.50) per MT. Spot prices for wheat in China are currently above 3,000 yuan per MT.
• Japan is seeking 61,800 MT of milling wheat in its weekly tender. Jordan made no purchases in a tender that closed today to buy 120,000 MT of milling wheat but issued a similar tender with an Oct. 4 deadline.
• December SRW wheat rose above the 10-day moving average of $8.73 overnight and extended gains in today’s session, reaching $8.94 1/2.

Live cattle and feeder cattle are mostly lower at midmorning.

• Live cattle futures failed to sustain initial opening gains with the market’s technicals having turned increasingly bearish from Monday’s chart breakdown.
• Ideas last week’s cash upturn may be short-lived are also weighing on live cattle. Traders began the week expecting firmer cash trade again after last week’s average price firmed $1.75 to $144.94, but futures’ poor performance may make packers disinclined to raise bids.
• Weakness in wholesale prices is also bearish. Choice beef cutout values fell 79 cents Monday to $247.84, an 18-month low. Last week’s movement totaled 3,841 loads, the highest weekly total for the year so far and illustrating packers’ cutting prices to move product.
• December live cattle fell as low as $146.625, just above Monday’s low at $146.575.

Hog futures are sharply lower.

• Lean hog futures are extending Monday’s steep declines as a chart breakdown fuels technical selling. Weaker cash fundamentals are also weighing on the market.
• The CME lean hog index is down 60 cents to $96.99, the lowest since mid-February.
• Pork cutout values rose 53 cents Monday to $101.46 on strong movement of 348 loads.
• China will sell an unspecified amount of pork from state reserves as it tries to increase supplies ahead of the week-long National Day holiday that begins Oct. 1. In total, Beijing plans to sell 200,000 MT of pork from state-reserves to ease prices, which were 30% higher than year-ago last week.
• December lean hogs fell as low as $76.525, the contract’s lowest intraday price since late December.