*Prices as of Thursday afternoon
This week’s action:
Corn Mar down 25 @ $6.54
Beans March down 50 @ $14.74
KC Wheat March down 47 @ $8.40
Feeders March up .475 @ $186.50
Fats Feb down .65 @ $157.275
Hogs Feb down 5.30 @ $82.675
Crude Feb down 6.58 @ $73.93
Corn Dec23 down 18 @ $5.92
Beans Nov23 down 32 @ $13.85
KC Wheat July23 down 46 @ $8.30
If you have calves and like summer/fall prices, let us know. We can run through some LRP options.
Recap:
It has been a rough start to the new year for most commodities.
The dryness in Argentina has been making headlines all winter. Argentine soybean production is expected to decline 5-6 million metric tons compared to last year. Brazil is expected to produce 20-25 million metric tons more soybeans than last year. The most recent Brazilian soybean production estimates are in line with USDA’s estimate of 152 million metric tons. Only about 30% of Brazilian new crop has been sold compared to 35% last year and 55% two years ago so expect heavy selling pressure once their harvest gets underway.
U.S. ethanol production fell 18% over the past two weeks as the winter weather has slowed production and transportation. This is the 5th largest two-week fall on record.
For perspective of the 2022 marketing year, check out the charts of March23 futures below. February 24 was the day Russia invaded Ukraine.
Forecast:
Rains have been added to the 6-10 day forecast for key areas of Argentina.
Outside Markets:
The latest Job Openings and Labor Turnover Survey (JOLTS) showed 10.46 million jobs available, which is 6.4% of the labor market. Open positions outnumber available workers 1.7 to 1. Many traders view this as an indication the FED will continue raising rates as demand for workers is still historically high.
The labor market will soon get some more bodies, though, as tech and banking companies have announced heavy labor cuts to start the year. Led by Amazon who announced 18,000 employees will be laid off. Weekly mortgage applications were the lowest since 1996 last week. Bed Bath and Beyond announced they are staring down bankruptcy within weeks if they cannot restructure some debt.
The energy markets have taken a beating lately. Crude oil and natural gas trading at pre-Russian invasion levels. Natural gas has lost 40% of its value in just the last three weeks.
The first bitcoin was mined 14 years ago this week.
Something that Probably Means Nothing:
Tesla stock has lost 69% from its peak value of over $1.2 trillion early last year. At Tesla’s current market cap of about $350 billion it is STILL worth more the market cap of Toyota, Volkswagen, and Ford COMBINED. Be careful catching that falling knife.
