Grain markets hit hard after slightly bearish USDA report. Tuesday, July 12, 2022

The corn and soybean markets were lower ahead of the USDA reports, and then the selling really kicked in taking prices sharply lower in a volatile day of trade. I was surprised to see how hard the grain markets were hit after a slightly bearish report. Prices are undervalued at the current time.

First for the reports.

Corn domestic usage was cut by 25 million bushels and ending stocks went up by 25 million bushels to 1.510 billion bushels. For next year, ending stocks are now projected at 1.470 billion bushels.

The USDA projection for average farmer selling price was unchanged at $5.95 per bushel this year and lowered 10 cents for next year to $6.65.

Soybean crush was cut by 10 million bushels and ending stocks went up by 10 million bushels to 215 bushels. For next year, ending stocks were lowered to 230 million bushels.

The USDA projection for average farmer selling price was unchanged at $13.35 per bushel. For next year, the average selling price for soybeans was lowered by 30 cents to $14.40 a bushel.

September corn closed down 43 cents today at $5.94. December corn closed down 42 cents at $5.86. August soybean futures closed down 54 cents at $14.68, while the November contract closed 62 cents lower. Wheat futures closed 36 to 48 cents lower.

In outside markets, the U.S. dollar is fractionally lower. Crude oil is down $8.50 per barrel, and the stock market has rallied well off of its early day low and is now up 31 points.

In the livestock markets, August hogs closed down 80 cents at $108.37. August cattle closed up $2.20 at $136.15, and August feeders closed up $3.15 at $174.87.

The  grain market has been very volatile today. Markets were lower early in the day on improved weather forecasts and the hard down move in crude oil.

The slightly bearish USDA reports added to the selling with prices moving sharply lower at this hour. The reports were considered negative for corn, soybeans, and wheat. I will have more of the numbers in the afternoon update.

September corn has had a 50-cent trading range. August soybeans have had a 73-cent trading range, and September CBOT wheat having a 79-cent trading range.

At this hour, September corn is down 36 cents, and December corn is 44 cents lower. August soybean futures are down 60 cents. November soybeans are 64 cents lower. Wheat futures are lower, with CBOT wheat down 37 cents. KC wheat is down 32 cents, and Minneapolis wheat is 43 cents lower.

In the livestock market, August hogs are up 22 cents at $108.65. August cattle are up 72 cents at $136.87, and August feeders are up $4.62 at $179.55.

In outside markets, crude oil is now down $8.14 per barrel, the U.S. stock market is has turned higher, with the S&P 500 up 6 points, and the Dow is up 152 points.

The forecasts are still hot, but not as hot as Monday, with more rain in the short-term forecast for this week. Sharply lower crude oil prices are also weighing on the commodity complex.

September corn is up down 16 cents. December corn is down 18 cents. August soybeans are trading 30 cents lower, and November soybeans are down 27. Wheat futures are 16 to 26 cents lower.

On the Dalian Commodity Exchange in China, corn and soybean futures are slightly lower. On the Matif exchange in Europe, wheat futures are 13 cents a bushel lower at $11.48.

The USDA Crop Progress report showed corn conditions at 64% good/excellent; this was unchanged from last week. For soybeans, the USDA showed ratings at 62% good to excellent compared to 63% good/excellent last week. For spring wheat, the USDA showed ratings at 70% good/excellent compared to 66% good/excellent last week. Winter wheat harvest is reported at 63% complete.

None of these numbers are trend changers.

The major USDA July Supply/Demand report is today at 11 AM CT. The key to watch will be the US soybean production and ending stocks numbers. I will have my analysis in the noon market update.

Around the world, the stock market in China is down 1.2%. Japan is down 1.7%. European stocks are down 0.7%. In early U.S. trade, the stock market is now higher after a lower start. Crude oil prices are lower now down over $6 per barrel.

The livestock futures are mixed with hogs higher, live cattle lower, and feeder cattle higher.

Author: Al Kluis

Tags: cattle, markets, projection, feeders, corn, USDA, prices, животноводство, soybean, hogs