The rice market for both old and new crop have moved higher in the recent weeks. Old crop found support around $16.50 and has since moved above $18.00. September 2023 rice has moved back above $15.00 from the recent contract low of $14.30. Current dry weather is playing a part in the recent market increase as it has been around 2-3 weeks since the state has had any appreciable rainfall, affecting the crop condition.
With planting mostly complete for the U.S. and the state the focus turns to condition. The most recent crop report showed a 2% decrease in crop condition for U.S., down to 70% Good/Excellent. Arkansas has also reported a decrease of around 6% to 62% Good/Excellent.
The cotton market had been struggling amid weather, position-squaring, and the strength of the U.S. dollar. A new round of export sales will be reported later this week, along with updates for supply and demand. Rain continues to fall for key parts of the state, helping move production along and put further pressure on a breakout. Old-crop futures have been bouncing up and down finding support at 80 cents and nearby resistance at 87 cents. New crop cotton continues to run into resistance at 84.5 cents, while nearby support begins at 79.5 cents.
Cotton farmers are wrapping up planting, with 71% of the crop now being in the ground. Arkansas farmers are reported to be done planting, with a current crop condition of 83% good/excellent.
Brazil’s record soybean harvest has left the demand side of soybeans a bit quieter, as it has taken over the world’s export business. USDA reported 6.1 million bushels (mb) of old-crop soybeans were sold to Spain. However, old-crop soybeans still need 68 mb more in sales to reach the USDA’s export estimate of 2.015 billion bushels (bb). New crop soybeans rebounded off a recent November 2023 contract low of $11.30. The most nearby point of resistance is at $12.00. Some pressure could be seen in the coming days as cooler temperatures and rain come to the Midwest. While traders are expecting to see Friday’s USDA report to show a slight drop in yield and production.
Soybean planting is reported to be 74% complete for the U.S., with Arkansas being nearly done at 87% completed. The most recent planting reported gave a first look at soybean conditions, with the U.S. having currently having 62% of the crop being rated Good/Excellent. Current crop condition for Arkansas is 59% Good/Excellent.
September 2023 and December 2023 corn futures moved higher over the past few weeks since dropping below $5.00. A favorable weather outlook and dull demand will continue to add pressure on prices. This week The Office of the U.S. Trade Representative (USTR) has announced formal dispute settlement consultations with Mexico, under the U.S.-Mexico-Canada Agreement (USMCA), regarding measures restricting agricultural biotechnology that will impact U.S. corn exports. Other influential events contributing to prices are events in Ukraine and crop condition. Brazil is expecting a good safrinha corn crop, but a cold front next week could bring some frost that might give prices a push higher. With all key northern hemisphere crops mostly in the ground, the supply and demand estimates are not expected to change.
The most recent report showed the U.S. corn condition is 64% good/excellent down 5% from a week ago and 9% from this time last year. Arkansas corn condition currently sits at 58% good/excellent and 8% very poor/poor.
Live Cattle futures have seen a strong bull run in the last week, since June 1 August contracts have risen $10/CWT. Feeder cattle markets continue to gain momentum and have seen similar gains to the Live Cattle contracts. Cattle prices are being driven by a projected bumper corn yield this fall and expected national herd contraction through the remainder of the year.
Hog prices continue to lag as domestic demand struggles to reduce the cold storage stocks of pork. While harvest rates have fallen in the last several weeks higher carcass weights have negated much of the contraction, until the most recent week where we saw a reduction by 10% in pork harvest volume.