GRAIN CALLS
Corn: 8 to 12 cents higher.
Soybeans: 20 to 25 cents higher.
Wheat: 12 to 18 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat posted strong gains overnight after yesterday’s high-range closes. Outside markets are generally supportive, with the U.S. dollar index down nearly 300 points and crude oil futures modestly firmer.
Weather is price-supportive given forecasts for warm, dry weather over most of the Corn Belt, while China’s major wheat producing area continues to face heavy late-season rains that is threatening production and crop quality.
Ukraine says Russia continues to halt exports via the Black Sea grain deal by blocking registration of ships headed to Ukrainian ports. It said Russia had registered only one incoming ship for inspection in the last two days of May, which officials said was a “gross violation” of the initiative. Ukraine noted 50 vessels are waiting for inspection in Turkish territorial waters – some vessels had been waiting for inspections for more than three months.
Ukraine’s combined grain and oilseed crop production is expected to fall 5.8 MMT (7.9%) to 68 MMT this year, Ukrainian grain traders union UGA forecasts. The grain harvest could include 17.9 MMT of wheat and 23.3 MMT of corn, which would be down from 20.2 MMT and 27.3 MMT, respectively, in 2022. Oilseed production is expected to rise. UGA said combined exports of grains and oilseeds could total 43.9 MMT in 2023-24, which would be down 12.5 MMT (22.2%) from this year. Exports could include 15 MMT of wheat and 19 MMT of corn.
USDA this afternoon is expected to report soybean crush totaled 185.0 million bu. during April, which would be down 12.9 million bu. (7.0%) from March but up 4.1 million bu. (2.3%) from year-ago. Corn-for-ethanol use is expected to come in at 423.1 million bu., which would be down 14.9 million bu. (3.4%) from March but up 7.1 million bu. (1.7%) from last year.
Export sales data for the week ended May 25 is delayed until Friday due to Monday’s holiday.
CORN: July corn futures pushed above the 5-day and 40-day moving averages overnight after a major move off yesterday’s lows. Near-term resistance is the 50-day moving average around $6.05 and then last week’s high at $6.06 3/4. Wednesday’s spike low at $5.77 1/2 is key near-term support.
SOYBEANS: July soybean futures posted strong gains overnight after finishing well off yesterday’s lows. This week’s price action looks like a failed downside breakout. But the contract must push above $13.48 to signal a bigger corrective rebound is likely. Key near-term support is at Wednesday’s spike low at $12.70 3/4.
WHEAT: July SRW futures posted strong corrective gains and pushed above the short-term moving averages overnight after finishing high range on Wednesday. Near-term resistance is the 20-day moving average at $6.25 1/4. Wednesday’s spike low at $5.73 1/4 is near-term support.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Higher.
CATTLE: Live cattle futures are expected to open with a mostly firmer tone, though there could be two-sided trade throughout the day as traders are likely to remain conservative. June live cattle futures scored a new contract high for a fifth consecutive session on Wednesday, but the lead contract finished nearly $9.00 below last week’s average cash price. So far this week, light cash cattle trade has been reported around steady prices in the Southern Plains, though activity has been quiet in the northern market, which has been the price driver given tighter supplies in those states. Choice beef prices firmed 88 cents on Wednesday, while Select fell 62 cents. Movement improved to 137 loads. Post-holiday movement suggests retailers are gearing up for Father’s Day and July 4th features.
HOGS: Lean hog futures are expected to open higher on followthrough buying. Hog futures followed up Tuesday’s strong gains with a gap-higher open and additional corrective gains yesterday, forming a potential “v” bottom reversal on the daily price chart. Hog futures like to post dramatic reversals, especially after prolonged trending moves. But with summer-month contracts back at premiums to the cash index, which is down for a third consecutive day, the cash market must strengthen to build sustained buyer interest in futures. The pork cutout value firmed $1.59 on Wednesday. Movement was decent, but not spectacular, at 297.7 loads.