Continuing optimism about a ceasefire between Russia and Ukraine helped drag grain futures sharply lower again Tuesday.
Corn futures closed 7¢ to 22¢ lower through Jly ‘23 and then 2¢ to 7¢ higher.
Soybean futures closed 12¢ to 23¢ lower through Jly ‘23 and then mostly 6¢ to 10¢ lower.
The continued break in grains helped boost Cattle futures.
Feeder Cattle futures closed an average of $2.62 higher (60¢ to $4.32 higher).
Live Cattle futures closed an average of 86¢ higher.
Negotiated cash fed cattle trade ranged from mostly inactive with very light demand to a standstill through Tuesday afternoon, according to the Agricultural Marketing Service.
Live prices last week were at $138/cwt. in the Southern Plains and Nebraska and at $138-$142 in the western Corn Belt. Dressed prices were $221 in Nebraska and $221-$225 in the western Corn Belt.
Choice Boxed beef cutout value was 63¢ higher Tuesday afternoon at $264.50/cwt. Select was $1.48 lower at $254.84.
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Major U.S. financial indices closed higher Monday, apparently buoyed by signs of optimism regarding peace talks between Russia and Ukraine.
The Dow Jones Industrial Average closed 338 points higher. The S&P 500 closed 56 points higher. The NASDAQ was up 264 points.
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RaboResearch analysts expect higher corn, soybean and wheat prices to continue along a higher plane, according to a new report.
While the sudden shutdown of trade in the Black Sea region has sent corn and wheat prices to their highest in a decade, the 10-year outlook for all major crops has shifted up to a new price level, according to the report, which cites transformative geo-political changes, continued increases in demand and limited acreage availability as the drivers.
RaboResearch analysts explain the war in Ukraine effectively closed trade routes shipping agricultural products grown from the Black Sea region to other parts of the world. Continuing conflict will cut supplies of corn and wheat available to the global market. RaboResearch expects the U.S. to increase its exports to help fill the gap, which should increase prices paid to farmers. According to their analysis, a 200 million bushel increase in exports for each commodity would increase the 2022-23 average on-farm price for corn by approximately 13% and wheat by approximately 50%.
Figuring an increase of 200 million bu., and accounting for local basis, RaboResearch estimates the 2022-23 average on-farm price for corn at $5.77/bu.; $10.50 for wheat.
This year’s report is the first annual outlook from the organization to incorporate the expected expansion of U.S. soybean crush capacity into the 10-year acre and price estimates. Fueled by the growing demand for soybean oil as an ingredient for renewable diesel, RaboResearch analysts say crush capacity expansion is an important transformation driving long-term commodity prices to a higher level.