Trade is tracking our current export sales and where we usually are for this time of year. As of last week’s report, U.S. export sales on corn totaled 1.05 billion bu (bbu). This is 55 percent of the yearly forecast and below trade expectations. New crop export sales on corn currently total 56.7 million bu (mbu), which is low but in line with where we were last year at this time. Soybean sales currently total 1.75 bbu, which is 88 percent of the yearly forecast and a high volume. New crop sales total just 33 mbu though and are 80 percent less than a year ago. Hard red wheat export sales are 75 percent of their yearly forecast and soft red sales at 81.5 percent.

As we approach the U.S. spring planting season, more interest is falling on this year’s potential acreage in the U.S. It is believed this year’s U.S. corn plantings will range from 88 million to 92 million acres compared to last year’s 88.6 million. Better returns on corn and easing input costs are expected to instigate higher acreage. Soybean plantings are forecast to fall between 87 and 89.5 million acres compared to last year’s 87.5 million. Wheat plantings are getting the most attention with acreage estimated from 46 to 50 million acres, well above last year’s 45.7 million planted acres. Higher returns on wheat and favorable production conditions are the main reasons for the higher wheat plantings.

Even with this increase in planted acres, U.S. ending stocks may not change all that much. Ending stocks are also expected to increase by 494 million bu on corn, 72 million bbu on soybeans, and 78 million bu on wheat. Even with these increases, soybean stocks would remain in a rationing position. This is keeping an elevated amount of risk premium in the U.S. soy complex.

Trade is starting to pay closer attention to long-range U.S. weather outlooks. Thirty-day outlook models indicate cooler conditions across the northern half of the U.S. with above normal temperatures in the Delta. The northern parts of the U.S. are also expected to see higher precipitation for the next month. The 90-day models indicate heat will build in the Southeast U.S. while the rest of the country is near normal. The Eastern Corn Belt and Ohio Valley are forecast to see wet conditions during the period.

Rising interest rates are starting to become more of a market topic. Interest rates have steadily been creeping higher for the past several months and are now starting to be seen in farm loans. At the present time higher interest rates are being offset by high commodity values, but producers are becoming more concerned over what may happen if markets correct. One expenditure interest rates have not affected is land costs, where we have seen an increase of 12 percent in value in the past year.

Packers are starting to push for coverage ahead of the upcoming summer grilling season with an emphasis on beef demand. Cattle slaughter in the United States is down 1.7 percent from last year at this time and weights are coming in lower as well. If this trend continues it could start to impact the U.S. beef supply right when demand typically builds.

U.S. beef imports are becoming more of a market topic as volumes have started to increase. From January through November 2022 the United States imported 2.27 percent more beef than in the previous year. This put the 11-month total at 3.1 billion pounds. Main increases on the year are from Brazil, up 42 percent from last year, and Mexico with 10.74 percent more imports. While the yearly total seems large, it is still well below the 3.39-billion-pound import estimate form the USDA. For 2023 the USDA is predicting beef imports of 3.425 billion pounds.

The February cattle on feed report came out mostly as expected. As of Feb. 1, the United States had 11.7 million head of cattle on feed, 4 percent fewer than a year ago. Cattle placements in January were at the low end of estimates at 1.93 million head, which was 96 percent of last year. Marketings came in at 1.85 million for the month, which was a 4 percent increase from January 2022. These numbers confirm thoughts the U.S. beef supply will tighten as the year progresses.

The cold storage report for January showed a 5 percent increase in total red meat supplies from the previous month and a 9 percent increase on the year. Beef in cold storage on Jan. 31 totaled 532.7 million pounds, a decrease of 2 percent from the month before but an increase of 1 percent on the year. Pork in cold storage on Jan. 31 totaled 517.5 million pounds, up 13 percent on the month and 19 percent on the year.

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