NEWS

*Minneapolis Grain Exchange reported May 2023 trading volume of 251,517 contracts, representing a 4.4% year-over-year (YoY) decrease from the same period in 2022 and a 4.7% increase from April 2023. MGEX reported Hard Red Spring Wheat (HRSW) Futures volume of 209,677 contracts in May 2023, a 0.9% decrease YoY and a 2.4% decrease from April 2023. HRSW Options volume totaled 7,072 contracts in May 2023, a 31.2% decrease YoY and a 1.8% increase from April 2023.

*Contract negotiations between container terminal operations and longshoremen broke down and a work stoppage is in place at the Port of Oakland. The largest terminal at the Port of Long Beach is also shutting down today. U.S. Meat Export Federation President and CEO Dan Halstrom says this could impact meat shipments from the West Coast to Asia. “When it comes to chilled cargo, be it beef or pork, one of the keys is to have your closest port of calls which would be the West Coast. We can switch some of this cargo to places like the Gulf and the East Coast, but it’ll be at a disadvantage when it comes to shelf life and marketability of U.S. products.”

CORN

ANALYSIS

Corn closed the week $.67 1/2 higher. Last week, private exporters did not announce any export sales.

In the weekly export inspections report; U.S. corn exports, for the week ended 6/08/23, were solid again at 46.0 million bushels and continuing the steady, solid pace since early April, averaging 46.2 million bushels/week over the last 10 weeks and running well above the roughly 26.7 million bushels/week average that will be needed over the final 12 weeks of the 2022/23 marketing year to reach the USDA’s just-lowered 1.725 billion bushel export projection. China now has only around 17 mil bu of outstanding (unshipped) old crop purchases remaining on the books, while total unshipped old crop sales to all destinations are likely around 220 million bushels, vs 417 million unshipped a year ago at this time.

In the weekly crop progress and conditions report; U.S. corn conditions fell to 61% good/excellent vs 62% expected, 64% g/e last week and 72% last year.

In the weekly EIA report; U.S. ethanol production fell to 1,018k bpd in week ending June 9; down from 1,036k bpd the week prior but is up from 1,015k bpd last year. U.S. ethanol stocks fell to 22.2 mb, down from 22.9 mb the week prior and down from 23.2 mb in the same week last year.

STRATEGY & OUTLOOK

If futures can rally into weekly resistance, producers need to liquidate any long positions and hedge the 2023 and 2024 crops, also buy put options to supplement sales.

SOYBEANS

ANALYSIS

Soybeans closed the week $1.38 higher. Last week, private exporters did not announce any export sales.

In the weekly export inspections report; U.S. soybean exports last week were a marketing year low at 5.2 mil bu, down from the previous week’s 8.2 mil bu and falling well below last year’s same-week exports of 22.4 mil bu, but, most importantly, were again below the roughly 10.5 mil bu/week average that will be needed over the final 12 weeks of the marketing year to reach the USDA’s just-lowered 2.000 billion bushel export projection. With soybean exports not exceeding 9 million bushels over the last five weeks, averaging 7.0 mil bu/week during the period, and only around 99 mil b) of unshipped old crop sales remaining on the books.

In the weekly crop progress and conditions report; U.S. soybean conditions fell to 59% good/excellent vs 60% expected, 62% last week and 70% last year.

The monthly NOPA crush report was bullish as crush during the month of May set a new all time record at 117.915 mb, above estimates of 175.9 mb, well above last month’s 173.2 mb and a year ago levels of 171.1 mb. No doubt, production problems in Argentina have led to a resurgence of U.S. soybeans being crush for meal as well as soybean meal exports. Soybean oil stocks came in at 1.872 bp, below estimates of 1.942 bp, well down from last month’s 1.957 bp and last year’s 1.774 bp.

STRATEGY & OUTLOOK

If futures can rally into weekly resistance, producers need to liquidate any long positions and hedge the 2023 and 2024 crops. Producers should supplement sales with put options.

WHEAT

ANALYSIS

For the week, Chicago wheat closed $.11 higher; Kansas City wheat closed $.12 1/2 lower and Minneapolis wheat $.04 higher. Last week, private exporters did not announce any export sales.

In the weekly export inspections report; U.S. wheat exports, in the first full week of the 2023/24 marketing year, were modest at 9.1 mil bu, down from the previous week’s 11.2 mil bu and below same-week year ago exports of 15.1 million bushels. Through the first eight days of 23/24, wheat exports of 11.7 million bushels compare to 23.5 million a year ago. In order to reach the USDA’s 725 million bushel export projection, export inspections will need to average roughly 13.1 million bushels/week through next May vs last year’s 13.9 million/week average.

In the weekly crop progress and conditions report; U.S. spring wheat conditions fell to 60% good/excellent vs 63% expected, 64% last week and 54% last year. U.S. winter wheat conditions rose slightly to 38% good/excellent vs 37% expected, 36% last week and 31% last year and U.S. winter wheat harvest moved to 8% done vs. 4% last week and 9% last year.

STRATEGY & OUTLOOK

Supply led rallies remain selling opportunities for old and new inventory at major resistance levels.

LIVE & FEEDER CATTLE

ANALYSIS

Last week, live cattle closed $1.20 lower while feeder cattle closed $2.67 lower.

Last week, moderate volumes traded in North mainly at $185 live, $5 lower, and primarily $295 to $296 dressed, which is $4-$5 lower. Light to moderate trade occurred mostly at $182 in the south, $3 to $4 softer than the previous week.

Last week; the FCE had 1,070 head offered for sale and 142 head sold at $180.00.

The latest USDA steer carcass weights were up 4 pounds from last week at 887 pounds, which is 5 pounds heavier than a year ago.

The weekly export sales report has net beef sales for 2023 of 12,800 mts with shipments of 16,000 mts.

STRATEGY & OUTLOOK

Producers should have window or fence strategies to protect the downside but allow for upside potential.

LEAN HOGS

ANALYSIS

Lean hogs closed the week $5.40 higher.

Iowa/Southern Minnesota weekly hog weights for week ending June 10 has weights down to 279.9 pounds vs. 283.8 pounds last week and 286.3 pounds last year.

The weekly export sales report has net pork sales for 2023 of 26,700 mts with shipments of 36,000 mts.

STRATEGY & OUTLOOK

Producers can reduce hedges as values are at weekly support levels.