GRAIN CALLS
Corn: 1 to 3 cents higher.
Soybeans: 9 to 12 cents lower.
Wheat: Winter wheat 5 to 9 cents higher; spring wheat 3 to 6 cents higher.
GENERAL COMMENTS: Wheat futures firmed amid followthrough buying overnight amid global supply concerns. Corn also extended recent gains, though buying was curbed by sharp pressure on soybeans and soymeal. Outside markets are price-negative for grains, with the U.S. dollar index up around 275 points and front-month crude oil futures about $2.00 higher.
The East Coast and Gulf strike is into the second day, with no signs of an agreement between the United States Maritime Alliance (USMX) and International Longshoremen’s Association (ILA). Despite increasing pressure from business groups, President Joe Biden, who identifies as pro-union, has refused to intervene using the Taft-Hartley Act, emphasizing his support for collective bargaining. However, it appears the White House is indirectly stepping up pressure to get the situation resolved.
The Port of Long Beach, the second-busiest maritime trade hub in the U.S., is prepared to handle more cargo diverted from the East Coast and Gulf ports. Currently operating at 70% capacity, the port is in a strong position to manage any surge in shipments, according to CEO Mario Cordero. As of early this morning, 28 container ships were anchored outside the major Atlantic ports and Houston, with many more en route from Asia and Europe.
Commodity brokerage firm StoneX raised its U.S. corn crop estimate to 15.222 billion bu. (15.127 billion bu. last month) on a yield of 184 bu. per acre, up 1.1 bu. from last month. StoneX raised its production estimate to 4.613 billion bu. (4.575 billion bu. last month) on a yield of 53.5 bu. per acre, up 0.5 bu. from early September.
Russia’s grain exporters union said export volumes from the first quarter of the 2024-25 season were excessive and called for export limits to be imposed through a quota mechanism. The union said first quarter export volume stood at roughly 17 MMT, exceeding “reasonable parameters based on the export potential of the season and demand on the world market.”
Russia’s state weather forecast agency said conditions for winter crops in some key producing regions were “worse than usual” in October due to a lack of precipitation, specifically noting the Central, Southern, North-Caucasus and parts of the Volga regions.
Iran on Tuesday launched approximately 200 missiles at Israel, most of which were either intercepted or missed their targets, intensifying tensions in the Middle East. In response, Israeli Prime Minister Benjamin Netanyahu vowed retaliation, stating that Iran “made a big mistake” and would face consequences.
CORN: December corn futures are now trading above all but the 200-day moving average as the contract pushed to a new for-the-move high overnight, reaching $4.34 1/4. That level stands as initial resistance. Bulls’ upside target is a 50% retracement of the price drop from the May high to the August low around $4.41. The 100-day moving average around $4.28 is initial support.
SOYBEANS: November soybean futures continue to trade within last Friday’s broad range from $10.34 1/4 to $10.69 1/2, while maintaining the uptrend from the August lows. Those levels stand as near-term support and resistance.
WHEAT: December SRW futures poked above the 100-day moving average overnight are nearing a 38.2% retracement of the price plunge from the May high to the August low, which is around $6.12, and is backed by the 200-day average around $6.16. Near-term support extends from the psychological $6.00 mark to the 5-day moving average around $5.90 1/2.
LIVESTOCK CALLS
CATTLE: Choppy/lower.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a mostly weaker tone. While wholesale beef prices have stabilized and may have put in a short-term bottom, live cattle futures are short-term overbought. Plus, packer margins remain in the red and it appears steady-at-best is the likely path for cash cattle prices this week. As a result, we expect the market to post a downside correction. Key will be whether buyers show up under the market. Choice beef firmed $2.09 to $300.17, while Select rose 77 cents to $285.30 on Tuesday.
HOGS: Lean hog futures are expected to open with a mostly firmer tone after moderate to strong gains on Tuesday. Key will be whether futures push above yesterday’s highs. If that happens and fresh buying is uncovered, futures will make a run at the September highs. If that fails to happen or there isn’t sustained buying above yesterday’s highs, a pullback would be likely. The CME lean hog index is up 12 cents to $84.13 as of Sept. 30, marking a gain in two of the past four days. The pork cutout firmed 47 cents on Tuesday to $96.31, while movement improved to 315.5 loads.