GRAIN CALLS
Corn: 2 to 5 cents lower.
Soybeans: 6 to 12 cents lower.
Wheat: SRW 1 to 3 cents lower; HRW 2 to 5 cents lower; HRS steady to 2 cents higher.
GENERAL COMMENTS: Corn, soybeans and winter wheat pulled back from Monday’s gains during overnight trade, while spring wheat mildly favored the upside. Similar trade is expected during the start of daytime trade. Outside markets are relatively quiet this morning and won’t influence price action in the grains.
Prospects for extending the Black Sea grain deal are not encouraging at the moment, Russian RIA news agency reported, citing a Russian source familiar with the situation. But the Kremlin says communications on the situation are ongoing ahead of the May 18 deadline for the current deal.
USDA reported planting at 65% done for corn (59% five-year average) and 49% for soybeans (36%) as of Sunday. North Dakota and Wisconsin are the furthest behind, while much of the Corn Belt is running ahead of the normal planting paces.
USDA rated 29% of the winter wheat crop “good” to “excellent” as of Sunday, unchanged from the previous week. Traders expected a one-point increase in ratings. The amount of crop rated “poor” to “very poor” declined three points to 41%. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop improved 5.6 points to a still-historically low rating of 242.6. The SRW crop inched up 0.6 point to 376.5.
Scouts on the Wheat Quality Council’s annual HRW tour will begin sampling fields in central and northern Kansas, along with remote areas of far southern Nebraska, this morning.
World Weather Inc. says rain will develop in the Central and Southern Plains during the second half of this week with Oklahoma, parts of Kansas, the Texas Panhandle and southeastern Colorado expected to be the wettest. Additional scattered showers and thunderstorms will impact the southwestern Plains, including West Texas late this weekend into early next week.
World Weather says weather will favor crops development across the major U.S. growing areas the next 10 days to two weeks.
CORN: July corn futures continue to pivot around the 10-day moving average, which is currently near $6.12, as the contract consolidates in the recent range. Near-term boundaries for the consolidation range are at $5.69 1/4 and $6.00.
SOYBEANS: July soybean futures gave back all of Monday’s gains during overnight trade. Near-term support extends from last week’s low at $13.85 1/4 to the March low at $13.83 3/4. Near-term resistance extends from $14.00 to the $14.22 area.
WHEAT: July HRW wheat futures closed above the February high at $8.94 1/4 overnight but pulled back below that level overnight. Near-term support is in the $8.91 to $8.80 range. Monday’s high at $9.12 1/4 is near-term resistance.
LIVESTOCK CALLS
CATTLE: Mixed.
HOGS: Higher.
CATTLE: Live cattle futures are expected to open with choppy trade this morning. While the cash cattle market unexpectedly firmed 20 cents last week to an average price of $174.13 and futures are trading well below that level, we anticipate traders will remain cautious buyers. Choice boxed beef prices fell another $2.63 on Monday, while Select firmed 3 cents. Movement totaled only 91 loads. Retailer buying remains erratic ahead of the upcoming Memorial Day week, which unofficially kicks off the grilling season. May and June are typically strong demand periods for beef.
HOGS: Lean hog futures are expected to open higher on followthrough buying after strong gains on Monday. But the trimming of gains into the close yesterday could be a precursor to a pullback today if earlier buyer interest is limited. The CME lean hog index is up another 59 cents to $76.50 (as of May 12). June lean hog futures finished Monday $9.65 above today’s cash quote. The pork cutout value firmed 97 cents on Monday, while movement totaled 306.7 loads. The Choice beef/pork cutout ratio has come off its recent highs but is still historically wide at nearly 3.6.