U.S. beef exports are on a record pace for the first nine months of the year. U.S. Meat Export Federation Chairman Dean Meyer is impressed with global demand for protein.

“When we can increase sales despite COVID, infrastructure issues and a rising dollar, you know there are opportunities,” he said.

Meyer credits USMEF with diversifying the market and promoting undervalued meat cuts.

“Beef tongue is worth maybe $3 a pound here: I was in Japan six weeks ago, went to supermarket and they had beef tongue for $25 U.S.,” said Meyer. “USMEF really adds value with those underutilized, variety meats; it adds $60 a head to every beef carcass here.”

CORN

ANALYSIS

Corn closed the week $.24 lower. Last week, private exporters announced sale of 4.5 mb of corn to Mexico.

In the weekly export inspections report; U.S. corn exports, for the week ended 11/24/22, were 11.9 million bushels, down from the previous week’s 19.6 mil bu, substantially below last year’s same-week exports of 31.7 mil bu and were the second lowest of the first 12 full weeks of the 2022/23 marketing year, just beating the marketing year low of 9.2 million bushels in the first week of November. Over the last four weeks, corn export inspections averaged 15.4 mil bu/week vs 31.1 million/week during the same period last year. Cumulative export inspections of 229 million bushels are down 33 percent from last year’s 340 million and falling vs the USDA’s 2.150 billion bushel export projection reflecting an estimated 13 percent decline in exports from last year. In order to reach the USDA’s export projection, inspections would need to average roughly 44.9 million bushels/week over the remainder of the marketing year, nearly identical to last year’s 45.6 million/week average from this point forward.

In the weekly EIA report; U.S. ethanol production fell to 1,018k bpd vs 1,041k prior week for week ending Nov. 25. This was down from 1,035k bpd a year ago. Ethanol stocks rose to 22.0 mb, up from 22.8 mb last week, a 12 week high and 20.3 mb last year.

STRATEGY & OUTLOOK

The market is telling producer to sell into a strong basis and look to re-own on weakness.

SOYBEANS

ANALYSIS

Soybeans closed the week $.07 higher. Last week, private exporters announced sales of 4.0 mb of soybeans to an unknown destination and 5.0 mb of soybeans to China.

In the weekly export inspections report; U.S. soybean exports last week were seasonally solid again at 74.3 mil bu, slipping from the previous week’s 89.1 mil bu and were below last year’s same-week exports of 83.0 mil bu. Over the last seven weeks, soybean exports averaged 86.3 million bushels/week vs 93.5 million last year during the same period and should remain seasonally strong over the next month or so as year ago exports during the coming five-week period averaged 68.5 million bushels/week before beginning the seasonal pullback. In order to reach the USDA’s 2.045 billion bushel export projection, soybean export inspections will need to average roughly 31.9 million bushels/week over the remainder of the marketing year vs last year’s 32.2 mil bu/week average from this point forward.

In the USDA’s fats and oils report, the USDA reported U.S. soybean crush in October was 196.6 million bushels, slightly above average market expectations of 195.9 million, up from 167.6 million bushels in September and was nearly identical to October crush the last two years of 196.9 million bushels last year and 196.6 million in 2020. USDA reported U.S. soybean oil production in October was 2.338 billion pounds vs 1.993 billion in September and 2.348 billion pounds last year October.

STRATEGY & OUTLOOK

Tight stocks suggest little room for error, but Brazil is expected to plant a record 105.5 million acres this fall and will undercut U.S. exports in January.

WHEAT

ANALYSIS

For the week, Chicago wheat closed $.32 3/4 lower; Kansas City wheat closed $.39 1/4 lower and Minneapolis wheat $.28 1/4 lower. Last week, private exporters did not announce any export sales.

In the weekly export inspections report; U.S. wheat exports last week were weak again at 7.3 mil bu, down from the previous week’s 10.7 mil bu, as well as last year’s same-week exports of 14.4 mil bu. Over the last four weeks, wheat exports averaged just 7.7 mil bu/week vs 11.4 million/week during the same period last year, with cumulative export inspections of 385 million bushels falling to a 10-week low relative to last year’s 401 million bushels of down 3.8 percent. In order to reach the USDA’s 775 million bushel export projection, wheat shipments need to average roughly 13.3 million bushels/week through the end of next May vs last year’s 12.8 million/week average during the same period.

In the weekly crop progress and conditions report; U.S. winter wheat conditions were 2 percent improved at 34 percent good/excellent vs 33 percent expected, 32 percent last week and 44 percent last year.

The StatsCanada report for December had all wheat at 33.824 mts vs. 34.703 mts in September and 22.296 mts last year.

STRATEGY & OUTLOOK

Commercials are buying and large spec open interest is at a low. A rally off weekly technical support could be very bullish.

LIVE & FEEDER CATTLE

ANALYSIS

Last week, live cattle closed $.67 higher while feeder cattle closed $3.75 higher.

Last week, there was light to moderate fed cattle cash trade in the north at mostly $157/cwt live and $245 to $249 dressed. This is mostly steady with the prior week. Light to moderate volumes traded in the south at mainly $155, which is steady with last week.

Last week; the FCE had 1,541 head offered for sale and no cattle sold.

The latest USDA steer carcass weights were up one pound from last week at 930 pounds, which is 8 pounds above last year.

The weekly export sales report has net beef sales for 2022 of 15,400 mts; 2023 sales of 2,000 mts and shipments of 15,800 mts.

STRATEGY & OUTLOOK

Producers should have window or fence strategies to protect the downside but allow for upside potential. A struggling economy looks to cap rallies in 2022 and into 2023.

LEAN HOGS

ANALYSIS

Lean hogs closed the week $1.97 higher.

Iowa/southern Minnesota weekly hog weights for week ending Nov. 26 has weights at 285.1 pounds vs. 284.4 pounds last week and 290.8 pounds a year ago.

The weekly export sales report has net pork sales for 2022 of 20,100 mts; 2023 sales of 3,800 mts and shipments of 29,700 mts.