GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 3 to 6 cents higher.
Wheat: 2 cents lower to 2 cents higher.
GENERAL COMMENTS: Soybeans traded higher on followthrough buying overnight, though the market backed well off its session highs after the weekly export sales data was released. Corn and wheat futures posted narrow, two-sided trade overnight. The U.S. dollar index is nearly 700 points lower this morning, which may attract some buyer interest in the grain and soy markets, though crude oil futures are weaker.
Export sales for the week ended Feb. 2:
Corn: Net sales of 1.160 MMT were near the top of expectations ranging from 600,000 MT to 1.2 MMT. Sales declined 27% from the previous week but were 19% above the four-week average.
Soybeans: Net sales of 459,400 MT for 2022-23 were near the bottom of expectations ranging from 400,000 MT to 1 MMT. Sales dropped 38% from the previous week and 49% from the four-week average. China was a net buyer of 518,900 MT for the week.
Wheat: Net sales of 131,400 MT for 2022-23 were near the bottom of expectations ranging from 125,000 to 450,000 MT. Wheat sales declined 4% from the previous week and 56% from the four-week average.
World Weather Inc. says Argentina’s rainfall over the next 10 days will be greatest in the central and especially the northeast areas of the country. Rainfall totals of 0.30 to 1.00 inch and local totals up to 1.50 inches will be possible in this region. Only light rain is currently advertised in the southwest Saturday into Monday with the European model drier than the GFS (American).
Brazil will continue to see rain across much of the country. Dry areas of Rio Grande do Sul will receive some showers today and Friday and more rainfall Tuesday and Wednesday of next week. Mato Grosso and other safrinha corn production areas will see alternating periods of sun and rain during the next two weeks, keeping soybean harvest pace slow, though progress is likely.
Consultancy Strategie Grains for a second month in a row raised its forecast of European Union soft wheat production this year, citing good growing conditions to date. The firm now expects EU soft wheat output of 129.7 MMT in 2023-24 season, up 400,000 MT from last month’s forecast. That would be a 4.1-MMT (3.3%) increase from 2022-23. Strategie Grains cut its forecast of EU soft wheat exports in 2022-23 by 1.7 MMT to 30.1 MMT, though it increased its outlook for 2023-24 exports by 400,000 MT to 30.6 MMT.
CORN: March corn futures again held in a tight trading range overnight while pivoting around the 20-day moving average, which has been the case recently. Near-term resistance starts at the 10-day moving average around $6.79 and extends to the January high at $6.88 3/4. Near-term support extends from last week’s low at $6.71 1/2 to the 40-day moving average around $6.69.
SOYBEANS: March soybean futures built on Wednesday’s gains overnight. Near-term resistance extends from the overnight high of $15.33 3/4 to the January high at $15.48 1/2. Near-term support is at Wednesday’s low at $15.05 3/4, followed by the 40-day moving average around $15.04.
WHEAT: March SRW wheat futures mildly pushed above yesterday’s high overnight, reaching $7.70 1/2. Near-term resistance is last week’s high at $7.76 1/2. Near-term support extends from $7.57 1/4 to Tuesday’s low at $7.44 1/4. The short- and intermediate moving averages all lie within that range.
LIVESTOCK CALLS
CATTLE: Mixed.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mixed tone as traders wait on cash cattle trade to develop. Cash cattle prices are expected to rise again this week, but with futures marking contract highs on Tuesday and at premiums to the cash market, traders aren’t likely to get too aggressive until higher cash trade is confirmed. Choice boxed beef prices firmed 48 cents on Wednesday, while Select dropped $4.17. That widened the Choice/Select spread to $14.04. Packers moved a solid 110 loads on the day, roughly the same as the first two days of the week. USDA reported net beef sales of 16,400 MT for 2023.
HOGS: Lean hog futures are expected to open with a mostly firmer tone as cash fundamentals are showing more signs of a seasonal bottom. The CME lean hog index is up 24 cents to $73.75 (as of Feb. 7), marking the fifth straight daily gain and nine of the last 11 days it has been higher. The pork cutout value firmed 73 cents on Wednesday, though movement slowed to 259.7 loads. USDA reported net pork sales of 28,800 MT for 2023, primarily to Mexico (12,700 MT), South Korea (4,700 MT) and China (3,400 MT).