GRAIN CALLS
Corn: 4 to 8 cents higher.
Soybeans: 8 to 15 cents higher.
Wheat: 10 to 15 cents higher.
GENERAL COMMENTS: Corn, soybean and wheat futures posted active followthrough buying overnight on help from surging crude oil futures. All signs point to the buying continuing during the start to daytime trade. The question will be whether funds are active buyers to the start the new month or use the recent surge as a selling opportunity.
Exporters announced daily corn sales totaling 150,000 MT to Mexico for 2023-24. USDA also announced daily soyoil export sales of 20,000 MT to unknown destinations for 2022-23.
OPEC+ announced a surprising cut of more than 1 million barrels per day over the weekend, which triggered a surge in crude oil prices overnight.
Argentina’s government will announce details of a preferential exchange rate for ag exports today. The policy will be similar to the “soy dollar” plan used in September and December of last year, though the actual exchange rate is not yet know – and this time it is expected to include other commodities besides soybeans.
AgRural estimates Brazil’s soybean harvest reached 76% done as of last Thursday, behind last year’s 81% pace. Safrinha corn planting was 99% completed and likely finished up over the weekend.
USDA will release its first national winter wheat crop ratings of the spring this afternoon. Based on state reports, the HRW crop condition ratings will be down notably from last fall when the crop went dormant. HRW areas will continue dry biased this week with temperatures warming this weekend into next week to enhance crop stress in dryland areas.
Flood risks are high and rising after the weekend snow event in the Northern Plains and upper Midwest. World Weather says a new storm during the middle of this week will produce six to 20 inches of snow and a blizzard across the Dakotas to southern Manitoba Canada and northern Minnesota. Another 0.50 to 1.75 inches of moisture will be added to the snowpack waiting to be melted. The Delta and Tennessee River Basin will be too wet this week and may experience flooding as another two to six inches of rain falls from eastern Texas to the southern Tennessee River Basin.
USDA this afternoon is expected to report February soybean crush totaled 175.4 million bu., which would be down 8.2% from January but up 0.6% from last year. Corn-for-ethanol use is expected to total 406.4 million bu., which would be down 8.4% from January but 0.1% more than last year.
CORN: May corn futures pushed above last Friday’s high overnight. Near-term resistance is in the $6.67 1/2 to $6.71 3/4 range. Above that, bulls would target the January high at $6.86, which lines up with the projected target after last week’s breakout above the inverted head-and-shoulders formation. Near-term support starts at the 200-day moving average around $6.59 1/2 and the 100-day average at $6.58.
SOYBEANS: May soybean futures reached their highest level since March 9 during overnight trade. Near-term resistance is layered from the $15.20 level to the February high at $15.49 3/4. Near-term support is in the $15.02 1/2 to $15.00 range.
WHEAT: May SRW wheat futures are trading above the 5-, 10- and 20-day moving averages, signaling short-term momentum is turning up. Near-term resistance is layered from $7.20 1/2 to $7.28 1/4, where the intermediate moving averages and last week’s high stand. Near-term support is in the $6.90 3/4 to $6.81 range.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Mixed.
CATTLE: Live cattle futures are expected to open higher on followthrough buying and the surge in commodities led by crude oil. But it wouldn’t surprise us to see some profit-taking after strong gains last week as traders wait on this week’s cash cattle trade to develop. Cash cattle traded sharply higher last week and cash sources expect firmer prices again this week, though gains won’t likely be nearly of the same magnitude. Packers have fresh contract supplies available with the flip of the calendar, which will help limit their need to be as aggressive with cash bids. Wholesale beef prices traded sharply higher Friday, with Choice up $2.87 and Select $2.26 higher. Movement totaled 90 loads.
HOGS: Lean hog futures are expected to open with a mixed tone. Weakening technicals and cash fundamentals suggest the market will face more pressure, though the general strength in the commodity sector could attract some buyer interest. The CME lean hog index is down another 31 cents to $75.46 (as of March 30), extending the price slide to a 10th consecutive day. April lean hog futures finished Friday 21 cents below today’s cash quote, suggesting traders sense the cash slide will continue. The pork cutout value fell $1.51 on Friday, while movement totaled 336.6 loads. Until cash fundamentals post a bottom, buyer interest in futures will remain limited.