GRAIN CALLS
Corn: 1 to 4 cents lower.
Soybeans: 15 to 20 cents lower.
Wheat: SRW and HRS 12 to 15 cents lower. HRW 15 to 20 cents lower.
GENERAL COMMENTS: Soybeans and wheat faced heavy pressure overnight, while corn was pulled lower by spillover pressure. All indications suggest bears will retain the upper hand at the start of daytime trade. Outside markets are mixed, with crude oil futures more than $1.00 lower and the U.S. dollar index around 200 points lower this morning.
Rainfall will be limited across the Corn Belt this week, according to World Weather Inc., though some pop-up showers are possible. Temperatures are expected to be normal to slightly above normal but not excessively hot. A cool front is expected to move across the region next week, bringing an increased chance for some rains. The Delta and Southeast will also experience net drying over the next week to 10 days.
USDA will update planting progress and crop emergence this afternoon. It will also release the first corn crop condition ratings of the growing season.
President Joe Biden and House Speaker Kevin McCarthy (R-Calif.) reached a bipartisan framework deal to raise the debt ceiling and implement many spending cuts demanded by Republicans. The package is expected to be voted on Wednesday in the House, and then the Senate late this week.
Russia warned the West on Monday a deal allowing Ukrainian grain to be exported from the Black Sea would cease unless a United Nations agreement aimed at overcoming obstacles to Russian grain and fertilizer exports was fulfilled. Meanwhile, Russia will raise its base price for calculating wheat, barley and maize export taxes, which should reduce export duties.
AgRural raised its Brazilian corn crop estimate by 2.3 MMT, due mostly to an expected bigger safrinha crop. Safrinha corn harvest stood at 0.8% as of last Thursday, according to the Brazil-based consulting firm. Crop Consultant Dr. Michael Cordonnier increased his Brazilian corn crop forecast by 1 MMT to 126 MMT.
CORN: July corn futures held in a relatively tight trading range around last Friday’s closing level overnight, despite heavy pressure on the soybean and wheat markets. Last Friday’s high at $6.06 3/4 is initial resistance, with stronger resistance at the 100-day moving average near $6.26 1/2. Near-term support is the 40-day moving average at $6.01 1/4 and the psychological $6.00 mark.
SOYBEANS: July soybean futures remain in the consolidation range around the recent lows that has formed a bear flag/pennant. Near-term resistance is at $13.48. Near-term support is at $13.04 3/4.
WHEAT: July HRW wheat futures broke below last week’s low during overnight trade, extending the steep pullback from the mid-May highs. Near-term support is at the psychological $8.00 mark. Near-term resistance starts at the 5-day moving average at $5.18 1/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Mixed.
CATTLE: Live cattle futures are expected to open with a mostly firmer tone. After packers raised cash cattle prices last week, traders begin this week with bullish hopes as market-ready supplies remain tight. But packers will have fresh contract supplies available on Thursday and they purchased a large volume of cattle last week. That could lead to reduced packer demand for cash cattle. Choice boxed beef prices surged $3.99 last Friday, while Select firmed 38 cents. Traders will closely monitor beef movement through the week as Memorial Day was the unofficial start to the summer grilling season.
HOGS: Lean hog futures are expected to open with a mixed tone. Futures are heavily oversold and at big discounts to the cash index, which should generate some corrective buying. But the path of least resistance is down and traders have been relentless sellers. The recent string of gains in the cash hog index came to an end. But June lean hog futures finished last Friday more than $4.00 below today’s cash index quote. The pork cutout value firmed $1.01 on Friday, though movement slowed to 204.1 loads.