Rice
Harvest pressure is taking its toll on rice futures. USDA says 59% of the crop has been harvested. In Arkansas, 61% was in the bins as of September 25. November futures have backed away from resistance at $17.95 ½ for now, but the market has held above support at $17.19 ½ for now. From a fundamental perspective, the situation for rice is bullish. In the September reports, U.S. all-rice production was lowered to165.144 million hundredweight and ending stocks for the markting year were lowered to 30.9 million bushels down 22% from the previous year. That was due to a 41 lb/acre cut in expected yield. Average expected yield nationwide is now pegged at 7,586 lb/ac. In Arkansas, the average yield is projected to be 7,500 lb/acre. USDA raised the expected on-farm price of long and medium grain rice by another 50 cents to $16.50 and $17.00 respectively.

Cotton
The story for cotton was very different, as USDA raised the 2022 U.S. crop forecast by 1.262 million bales despite a lower projected yield per acre. USDA raised harvested cotton acres by 747,000 acres, including 145,000 acres in Arkansas. Both FSA certified acres and Boll Weevil Eradication enrollment suggested Arkansas acres were significantly underestimated by NASS, and this correction reflects that. Across the country, planted acreage was raised from 12.48 million to 13.79 million acres. Exports were raised to 12.6 million bales, and the U.S. on-farm average price dropped a penny to 96 cents/pound. The strength in the dollar, which is setting new 20-year highs almost every day, lower crude oil prices, and weakness in the Dow are all adding pressure to the cotton market. December is back in position to potentially test support at the July low of 82.54 cents. As Hurricane Ian comes ashore in Florida, portions of the cotton crop are in jeopardy. USDA said on Monday that 67% of the crop nationally had opening bolls, and harvest is 15% complete.

Soybeans
After failing to close above resistance at $15, November soybeans have moved lower and are now in position to test support at $14. If that support doesn’t hold, there is additional support near $13.75. Harvest has just begun and is 8% complete, compared with a 5-year average of 13%. USDA estimates the national average yield to be 50.5 bushels per acre, which shocked the market and was a full bushel below the average trade guesstimate. However, the crop was planted late and cool nights could impact yields further.

Corn
December corn futures continue to be capped by resistance at $7. Supplies remain tight as harvest is just beginning, but harvest pressure will impact the market sooner rather than later. Weather forecasts throughout the mid-west are favorable for harvest activity. These prices should be seen as a pricing opportunity for farmers. Strength in the dollar and lower crude oil prices are also negative for prices. 

USDA lowered their U.S. crop and carryout forecasts for corn, too. A 1.2 million acre cut in the planted acreage estimate was a surprise. It was partially offset by an increase in the average yield estimate to 172.5 bushels per acre, but supply estimates were reduced more than use estimates, resulting in a projected carryout of 1.2 billion bushels. The season-average corn price was raised 10 cents to $6.75 per bushel.

Cattle
Cattle futures have turned sharply lower after setting new highs for the move last week. The technical signals are very negative and suggest further weakness is likely. December live cattle charted a huge weekly reversal and moved to 8-week lows. Higher interest rates and general economic concerns and seasonal weakness in wholesale beef prices are adding pressure to the market. Packer margins continue to narrow as well. The September Cattle-on-Feed report was somewhat negative, with August feedlot placements coming in at the high end of expectations.

Hogs
Lean hog futures charts also look extremely bearish at this point. The February contract is now trading at its lowest level since February and testing resistance at $80. The September USDA Cold Storage report showed frozen pork stocks up 20% from last year. Additional pressure is coming from seasonally-higher hog supplies.

Dairy
The 2022 milk production forecast was lowered this month in the Supply/Demand report. Milk cow numbers have been reduced, and slower growth in cow numbers is expected through the rest of the year and into 2023. Output-per-cow is forecast to increase at a slightly more rapid pace in 2022. The forecasts for butter prices and nonfat dry milk prices were raised slightly on current price strength. Both Class III and Class IV prices were raised, reflecting changes in their component values. The 2022 all milk price forecast was raised to $25.45/cwt.