GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 1 to 3 cents higher.
Wheat: SRW and HRS steady to 2 cents lower; HRW steady to 2 cents higher.
GENERAL COMMENTS: Price action was quiet and two-sided in the grain and soy markets overnight. We expect the directionless price action to continue during daytime trade. However, outside markets are price-negative and could be a factor in today’s trade. Front-month crude oil futures are around $2.50 lower and the U.S. dollar index is about 550 points higher this morning.
USDA announced a daily corn sale totaling 120,800 MT to unknown destinations for 2022-23.
World Weather Inc. says unusually cool temperatures occurred in southwestern Argentina this morning with extreme lows of 37 to 46 degrees, though readings weren’t cold enough for long enough to induce crop damage.
Argentina is expected to remain dry though the middle of next week. Rains are expected the second half of next week, though World Weather says they will only provide temporary relief.
Rains will continue across central Brazil, which will continue to slow soybean harvest and safrinha corn planting.
Negotiations will start in a week on extending the Black Sea grain export deal, according to a senior Ukrainian official. The agreement was extended by a further 120 days on Nov. 18. “Negotiations on extending the grain corridor will begin in a week and then we will understand the positions of all parties,” Ukrainian Deputy Infrastructure Minister Yuriy Vaskov said. “We see that the enemy is starting to put forward new conditions. We understand that it will be difficult – as it was in November. I think common sense will prevail and the corridor will be extended,” he said. With Russia set to export a record amount of wheat during the second half of the 2022-23 marketing year, it has incentive to drag its feet and talk up wheat prices during the negotiation process.
CORN: March corn futures continue to find buyers on tests of the 40-day moving average, which is around $6.73 and will serve as initial support. The 10- and 20-day moving averages converge at $6.78 to form initial resistance.
SOYBEANS: March soybean futures continue to pivot around the 10-day moving average, which is near $15.28. Near-term support is at the 20-day average at $15.22 3/4 and Wednesday’s low at $15.16 1/2. The 5-day moving average around $15.32 1/2 is initial resistance, with additional resistance layered to Monday’s high at $15.55 1/2.
WHEAT: March SRW wheat futures are leaning on support at the 20-day moving average near $7.58 1/2. Additional support is at the 40-day average near $7.57 and the 50-day average at $7.55 1/2. The 10-day average at $7.68 1/4 is near-term resistance.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mostly firmer tone on beliefs packers will pay higher money for cash cattle. So far, cash trade has been light at slightly firmer prices compared with last week. Choice boxed beef prices firmed another $3.88, while Select rose $1.45 on Thursday. Choice beef has jumped nearly $15 since Feb. 3 and is almost $37 above the December low. Surging wholesale beef prices have improved packers’ margins significantly, giving them incentive to actively compete for a tightening supply of market-ready cattle.
HOGS: Lean hog futures are expected to open with a mostly firmer tone. After two days of corrective selling, strength in cash fundamentals should attract some buyer interest. The pork cutout value more than recouped Wednesday’s loses with a $2.12 jump yesterday. All cuts except ribs were sharply higher, led by a $6.51 rise in bellies. Meanwhile, the CME lean hog index continues its rise, firming another 23 cents to $75.85 (as of Feb. 15). The premium in April lean hog futures dipped below $10 on Thursday’s close, though that’s still wider than the roughly $6 seasonal average into mid-April.