GRAIN CALLS
Corn: 3 to 6 cents lower.
Soybeans: 6 to 10 cents higher.
Wheat: SRW and HRW 8 to 12 cents lower; HRS 2 to 4 cents lower.
GENERAL COMMENTS: Soybeans traded higher overnight, while corn and wheat failed to sustain their initial corrective gains and finished the session under pressure. Soybeans should find additional support from fresh demand news, as USDA reported daily sales of 416,000 MT to unknown destinations for 2023-24. Outside markets are price-negative as crude oil futures are more than $1.00 lower, while the U.S. dollar index is over 300 points higher.
There will be two waves of cooler air and rains that move through the Corn Belt this week. Temps will be well above normal this weekend and next week in the Plains and western Corn Belt as a ridge of high pressure develops, suppressing rainfall and inducing much warmer weather. World Weather Inc. says highs will be in the 90s to near and above 100 possible, especially in the Plains.
A Russian warship fired warning shots on a Palau-flagged cargo vessel headed to the Ukrainian port of Izmail on Sunday. Ukraine “strongly condemned the provocative actions” of Russia, saying its navy “grossly violated the UN Charter, the UN Convention on the Law of the Sea and other norms of international law.” Meanwhile, Ukraine has started registering cargo ships for the humanitarian corridor in the Black Sea to allow cargo ships trapped at Ukrainian ports to move.
Since July 1, Ukraine has shipped 3.12 MMT of grains, 470,000 MT (17.7%) ahead of the same period last year. The grain exports included 1.48 MMT of corn, 1.25 MMT of wheat and 385,000 MT of barley.
Concerns are building with the health of China’s economy, real estate sector and financial markets. Country Garden Holdings, China’s largest privately held property developer, is in financial trouble and is reportedly seeking to delay payment on a private onshore bond for the first time. Meanwhile, two Chinese listed companies said over the weekend they had not received payment on maturing investment products from Zhongrong International Trust Co., one of China’s leading integrated financial service providers.
Brazil’s safrinha corn harvest reached 71% done as of last Thursday, according to AgRural, behind 85% on this date last year. While harvest has been slow, production is record-large.
CORN: December corn futures posted a bearish reversal on Friday and were unable to sustain early corrective buyer interest overnight. Near-term support is the July low at $4.81. Below that, support would be layered from $4.76 to $4.62 1/2. Near-term resistance is heavily layered from $4.90 3/4 to $5.07 1/2.
SOYBEANS: November soybean futures recouped much of Friday’s losses overnight. Near-term trading boundaries extend from $12.82 1/4 to $13.38. The eventual breakout from that range is likely to trigger the next trending move.
WHEAT: December SRW futures failed to sustain early corrective buyer interest overnight and fell below last Friday’s low. Near-term support is the July low at $6.41 1/2. Near-term resistance is heavily layered from the psychological $6.50 mark to $6.87 1/4.
LIVESTOCK CALLS
CATTLE: Mixed.
HOGS: Lower.
CATTLE: Live cattle futures are expected to open with a mixed tone as traders gear up for what’s likely to be another week of lengthy cash cattle negotiations. Cash cattle trade developed late Friday at steady/firmer prices, though trading volume was expected to be relatively light. If that was the case, this week’s showlist would be bigger. Typically, that would favor packers in cash negotiations. But given tight market-ready supplies, some packers may be short-bought on near-term needs. It’s unlikely there will be active trade ahead of USDA’s Cattle on Feed Report on Friday afternoon unless packers get aggressive with cash bids. Wholesale beef prices were mixed Friday, with Choice up 58 cents and Select down 57 cents. Movement was light at just 73 loads.
HOGS: Lean hog futures are expected to open under pressure amid weakening cash fundamentals. The CME lean hog index is down 85 cents to $103.06 (as of Aug. 9), extending the recent string of price weakness. August hog futures, which expire today and are cash settled on Wednesday, finished Friday 96 cents below today’s cash quote. October hogs, which will assume lead-month status, finished Friday $21.735 below today’s cash quote. The pork cutout value is also declining seasonally, falling $2.93 on Friday, due mostly to a $22.47 plunge in primal belly prices.