The Ag Analyst's Briefing: Week of Jan. 30
On the watchlist this week are the recent actions by the Fed. As well as recent and upcoming earning reports.
Interest Rate Hikes The Federal Reserve is expected to raise interest rates, yet at a slower rate, at this week’s FOMC Meeting. Expectations: 25 bps point increase to 4.50% to 4.75%. Fed dot plot calls for 5-5.25% by year end 2023.
Earnings Corteva and CNH (Case New Holland Tractors) will report quarterly earnings this week.
Equity Markets Despite calls for a recession and stock market sell-off, the S&P 500 and Nasdaq have gained 6% and 11%, respectively, YTD.
Livestock Semi-annual cattle inventory report comes out January 31. Key to watch is estimate of feeder cattle outside feedlot and how much it drops.
Corporate Layoffs Jobless claims fell last week however, companies continue to announce layoffs which could portend an increase in future claims. Examples last week included: Hasbro, IBM, Dow, SAP, and 3M.
Numbers of Interest
- Economic and Other
-104 bps Spread in basis points between the 10-Year and 3-Month Treasury Bond Yields
2.9% Initial estimate of U.S. 4Q 2022 GDP reported last week
4.4% Last week’s reading of the core Personal Consumption Expenditure (PCE) Index, the Federal Reserve’s preferred measure of inflation
$35.5 Bln. Chevron’s profit in 2022, 2x the prior year and 1/3 above the prior record level in 2011.
- Agri-Food
$4.8 Bln. ADM’s combined segment operating profit for 2022, up from $2.8 billion for 2021.
-53.8% Percentage decline in the Green Markets North American Fertilizer Index since the peak on March 22, 2022
-13.9% Percentage decline in U.S. soybean oil spot prices over the past 3-months.
Recent/Upcoming Investor Reports
January 26 Archer Daniels Midland (ADM)
February 1 & 2 Corteva (CTVA), CNH Industrial (CNH)
February 7 AGCO (AGCO) and FMC (FMC)
February 8 Bunge (BG), Green Plains (GPRE), Ingredion (INGR), Trimble (TRMB), Yara Int’l (YRAIF)
February 10 CF Industries (CF)
February 14 & 15 Andersons (ANDE) & Nutrien (NTR)
February 16 Valmont Industries (VMI)
February 17 Deere (DE) and Mosaic Company (MOS)
Stock Market Performance Closing Prices as of 1/27/2023
Source: BarChart.com Price Performance and WSJ