GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: Steady to 2 cents higher.
Wheat: Winter wheat 1 cent lower to 1 cent higher; HRS 1 to 3 cents lower.
GENERAL COMMENTS: Corn saw profit-taking, soybeans saw modest strength and wheat was caught in the middle in overnight trade. Disappointing corn and soybean sales led to an increase in selling pressure into the break. Producer price inflation (PPI) rose more than expected again in November, rising 0.4% month-over-month, above 0.3% in October and twice the expected rate. The annual rate accelerated for a second consecutive month, rising 3.0%, up from 2.6% in October. Core PPI, which excludes food and energy, rose 0.2%, as expected, to an annual rate of 3.4%. That sparked selling interest in equity futures this morning. The U.S. dollar index is around 100 points lower, while front-month crude oil futures are near unchanged and near recent highs.
USDA reported daily sales of 334,000 MT of soybeans for delivery to unknown destinations during the 2024-25 marketing year.
Conab raised its Brazilian soybean production estimate by 70,000 MT from last month to 166.21 MMT. Brazil’s corn crop forecast was lowered 180,000 MT to 119.63 MMT. Conab maintained its 2024-25 Brazilian export projections at 105.5 MMT for soybeans and 34 MMT for corn.
Efforts to extend the 2018 Farm Bill and provide financial aid to farmers have hit a political snag. Outgoing Senate Ag Committee Chair Debbie Stabenow (D-Mich.) supports reallocating $14.5 billion in unspent Inflation Reduction Act (IRA) funds to the farm bill baseline, potentially unlocking $10 billion in budget authority, according to some reports citing the Congressional Budget Office. However, Politico reports House Speaker Mike Johnson (R-La.) has indicated that most House Republicans oppose this move. Simultaneously, discussions are underway to combine the financial aid package with a separate disaster aid proposal, adding complexity to the legislative process.
Export sales for the week ended Dec. 5:
- Corn: Net sales of 946,900 MT for 2024-25, down 45% from the previous week and 32% from the four-week average. Sales totaled the least since mid-September. Increases came primarily for Colombia and Mexico. Sales came below expectations ranging from 1.1 to 1.9 MMT. Exports of 1.183 MMT were a marketing year high.
- Soybeans: Net sales of 1.174 MMT for 2024-25, down 49% from the previous week and 42% from the four-week average. Sales were the lowest since the second week of August, before the official start of the marketing year. Increases came primarily for China and Spain. Sales were below expectations ranging from 1.5 to 2.2 MMT. Exports totaled 1.859 MMT, with the bulk of the total being shipped to China.
- Wheat: Net sales of 290,200 MT for 2024-25, down 23% from the previous week and 31% from the four-week average. Increases came primarily for the Philippines and Mexico. Sales came in the lower end of expectations ranging from 275,000 to 600,000 MT. Exports totaled 198,900 MT.
CORN: March corn futures saw profit-taking overnight. Bulls are seeking to close prices above stiff resistance at the psychological $4.50 mark. Support comes in at $4.44 1/4 then the 10-day moving average at $4.41 1/4 on continued selling pressure.
SOYBEANS: January soybean futures are caught between 10-day moving average support at $9.92 1/2 and psychological $10.00 resistance. Additional support comes in at $9.90, while strength finds resistance at $10.09 3/4.
WHEAT: March SRW futures continue to grind higher. Resistance stems from yesterday’s high of $5.69 1/4, which is backed by the 40-day moving average at $5.70 1/2. Support stems from $5.61 3/4 then $5.54 on a reversal lower.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/higher.
CATTLE: Live cattle and feeders are expected to open higher in a continuation of yesterday’s technical breakout, but profit-taking could limit gains after the open as futures have quickly entered overbought territory. Futures were supported Wednesday by reports of cash cattle trading mostly $1.00 to $2.00 higher in the live market and as much as $3.00 higher in the dressed market. Wholesale beef prices continue to stall, with Choice cutout declining 50 cents to $311.23 and Select falling $1.54 to $278.11 Wednesday. USDA reported net beef sales of 11,000 MT for 2024, up notably from last week’s disappointing figure and 32% from the four-week average.
HOGS: Lean hog futures are expected to open with a mostly firmer tone on technical support that has limited losses the past two sessions. The 50-day moving average continued to attract buyers in February futures on Wednesday and will act as support today. The CME lean hog index is up 29 cents to $83.61 as of Dec. 10. Traders will keep a close eye on the cash market to see if this is a short-term pause or a seasonal bottom. Pork cutout fell 27 cents to $92.87 Wednesday, led by weakness in ribs and loins, while movement fell to 287.18 loads. USDA reported net pork sales of 22,500 MT for 2024, down 36% from the previous week and 1% from the four-week average.