GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 3 to 5 cents lower.
Wheat: SRW 2 to 5 cents lower; HRW 3 to 6 cents lower; HRS steady to 2 cents lower.
GENERAL COMMENTS: Wheat led weakness overnight though firmed into the break, soybeans eased from Monday’s gains and corn faced follow-through selling pressure. Outside markets are mixed this morning, as front-month crude oil futures are trading modestly higher, and the U.S. dollar index is trading around 450 points higher. Equity markets are facing modest selling pressure as interest rates are trading higher this morning ahead of the kickoff of the Federal Reserve’s Open Market Committee meeting that begins this morning and concludes tomorrow afternoon with a statement and press conference from Fed Chair Jerome Powell.
USDA rated 49% of the winter wheat crop as “good” to “excellent,” down one point from the previous week. The portion of crop rated “poor” to “very poor” stayed at 16%. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop dropped another 8.2 points to 317.4, led by a 4.8-point decline in top producer Kansas. The SRW crop improved 1.5 points to 387.0, led by a 1.3-point rise in top producer Illinois. The HRW CCI rating has declined 28.0 points since the initial level this spring and is now 6.0 points under the final mark from last fall. The SRW CCI rating has increased 15.5 points since the beginning of spring and is now 15.4 points above the final level ahead of dormancy. Click here for details.
South American crop consultant Dr. Michael Cordonnier lowered his Argentine corn crop estimate 1 MMT to 49 MMT, citing variable yields and impacts from corn stunt disease which will be greater in later-harvested fields. He warned the Argentine corn crop estimate could decline further. Cordonnier kept his Argentine soybean crop estimate at 51 MMT. He also kept his Brazilian crop estimates at 147 MMT for soybeans and 112 MMT for corn.
Today marks the start of the delivery process for May grain and soy futures. Deliveries totaled 533 contracts for soybeans, 222 contracts for soymeal, 2,101 contracts for soyoil and 1,151 contracts for SRW wheat. There were no deliveries against May corn or HRW futures.
Dry and improving to favorable conditions for planting occurred from a large part of the western Corn Belt into central and northern Illinois with northeastern Kentucky to south-central into eastern Ohio mostly dry while rain fell elsewhere, World Weather Inc notes. Regular rounds of showers and thunderstorms will occur through May 11, slowing fieldwork across the Midwest.
CORN: July corn futures saw follow-through selling overnight. Bulls are seeking to overcome initial resistance at the psychological $4.50 mark, which is backed by $4.52 1/2, then $4.54 1/2. Support comes in at yesterday’s low of $4.45 1/2 with backing from $4.41.
SOYBEANS: July soybean futures gave up a portion of Monday’s gains overnight. Initial resistance stands at $11.80, which prices fell below overnight. Firm resistance stands at the 40-day moving average, currently at $11.88. Support comes in at $11.72 1/2 then $11.66 3/4.
WHEAT: July SRW futures continue to face corrective selling. Bulls are seeking to reclaim initial resistance at $6.10 1/2, which is backed by resistance at $6.22 1/4. Support stands at the 10-day moving average at $5.97 1/4, which capped losses overnight. Further selling finds support at $5.88 3/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a modestly firmer tone on rising cash fundamentals. Last week’s cash cattle average followed futures higher, rising $1.48 from the prior week to $184.15. Packers purchased a hefty 93,000 head of cattle in the negotiated market last week, including 24,000 head “with time.” That could dampen packer demand for cash cattle this week, especially considering fresh contracted supplies become available with the turn of the calendar. Wholesale beef prices showed strength on Monday, as Choice cutout firmed 39 cents to $297.53 and Select rose $1.49 to $290.21. Steer dressed weights continue to firm contralesionally, a testament to packers cutting operating hours in an effort to manage margins deep in the red. USDA announced Monday it will test samples of ground beef in states with H5N1. While H5N1 has not been found in the U.S. beef herd, trader uncertainty may limit buyer interest.
HOGS: Lean hog futures are expected to start with a modestly firmer tone in a continuation of Monday’s rebound from a lower open. After gapping lower to start the week, June lean hog futures rebounded to close steady on the session despite continued weakness in the CME lean hog index. The index is down another 52 cents to $90.36 as of April 26, marking the third consecutive daily decline. That marks the first three-day slide in the index since the seasonally rally began at the beginning of the year. Rebounding wholesale pork prices likely helped fuel Monday’s rebound in futures, as cutout firmed $1.37 to $99.00, though that was down notably from the midsession jump of $7.09. While bellies firmed $31.99 in the midsession quote, lower afternoon trading brought that gain down to $4.38. Movement was strong at 332.7 loads, especially considering Monday’s have seen lighter wholesale trade.