GRAIN CALLS
Corn: 4 to 6 cents lower.
Soybeans: 5 to 8 cents lower.
Wheat: 6 to 10 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat failed to extend Wednesday’s gains overnight. Traders remain skittish amid macroeconomic uncertainty. Weekly corn export sales were discouraging. The U.S. dollar index has turned solidly higher in a rebound from sharp losses yesterday and overnight. Crude oil futures are trading near unchanged this morning.
Attempts to extend the Black Sea grain deal continue. It appears the United Nations and others, including the U.S., are making some concessions for Russian grain shipments. Turkish state lender Ziraat Bank could work as an intermediary to process payments for Russia’s grain exports, a senior Turkish official said, adding the U.S. and the United Nations would need to approve each transaction. Ziraat would serve in a similar role as JPMorgan, which has processed one payment and reportedly been given approval for around another 40 such transactions.
World Weather Inc. says additional rain fell in portions of West Texas, the Texas Panhandle and western/southern Oklahoma Wednesday and early today. The northeastern Plains and upper Midwest are expected to receive rains Friday through next Monday, with more rainfall likely during the middle to latter part of next week. The lower Midwest will likely be drier than normal over the next 10 days.
Export sales for the week ended April 27:
Corn: Net sales of 315,600 MT for 2022-23 were a marketing-year low. There were net old-crop sales reductions of 562,800 MT to China. Traders expected old-crop sales of (450,000) to 600,000 MT. Exports of 1.699 MMT were a marketing-year high. China took shipment of 201,800 MT of U.S. corn during the week. USDA reported net sales of 121,000 MT for 2023-24.
Soybeans: Net sales of 289,700 MT for 2022-23 dropped 7% from the previous week but rose 78% from the four-week average. China was the lead buyer at 134,300 MT. China also bought 67,000 MT for 2023-24. Traders expected old-crop sales of 100,000 to 400,000 MT.
Wheat: Net sales of 211,100 MT for 2022-23 rose 36% from the previous week and 14% from the four-week average. USDA reported net sales of 279,700 MT for 2023-24. Traders expected sales of 0 to 250,000 MT for 2022-23 and 50,000 to 300,000 MT for 2023-24.
CORN: July corn futures poked out to a new high for the week early in the overnight session but failed to sustain those gains and the contract weakened. Near-term support is layered from the 5-day moving average around $5.84 1/2 to yesterday’s low at $5.69 1/4. Near-term resistance is at the 10-day moving average near $5.93 1/2 and previous support at $5.97.
SOYBEANS: July soybean futures stalled overnight at the 10-day moving average around $14.20 1/2. That will serve as solid near-term resistance. Near-term support is layered from the psychological $14.00 mark to yesterday’s low at $13.92 1/4.
WHEAT: July HRW wheat futures failed to find sustained buying above the 10-day moving average around $7.82 1/2 during the overnight session. That level will serve as initial resistance, followed by the overnight high at $7.93 3/4. Near-term support is at the 5-day moving average at $7.66 1/2 and the March low at $7.63 3/4.
LIVESTOCK CALLS
CATTLE: Choppy/lower.
HOGS: Lower.
CATTLE: Live cattle futures are expected to open mostly lower on followthrough selling. But two-sided trade and even a price rebound is possible if early seller interest is light as the market has seen three days of sharp corrective losses and traders appear too pessimistic. Cash cattle traded steady (northern market) to $1 lower (Southern Plains) so far this week. While the average cash price will fall for a third consecutive week and wholesale beef prices are also weakening, the selloff in cattle futures is exaggerated. June live cattle finished Wednesday $15.50 below last week’s average cash price.
USDA reported net beef export sales of 20,100 MT for 2023, which increased 59% from the four-week average.
HOGS: Lean hog futures are expected to open under pressure on followthrough selling after sharp losses and a low-range close on Wednesday. The CME lean hog index is up another 76 cents to $73.78 (as of May 2), continuing the recent string of gains as the seasonal rally is finally underway. After Wednesday’s losses, the premium in May lean hog futures was down to $4.37 to today’s cash quote, while June hogs finished $14.22 above the cash index. The pork cutout value dropped $2.01 yesterday and packers moved only 280.4 loads for the day, signaling continued struggles with the wholesale market.
USDA reported net pork export sales of 49,000 MT for 2023, down 9% from the previous week’s marketing-year high but 15% above the four-week average. Mexico bought 14,600 MT and China purchased 14,200 MT. Exports of 38,600 MT were a marketing-year high.