GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 12 to 15 cents lower.
Wheat: 2 to 4 cents higher.
GENERAL COMMENTS: Wheat saw relative strength, corn pivoted near unchanged and soybeans saw continued selling pressure in the overnight session. Weakness in soy is likely to weigh on the grain complex after the open. Traders will look to this afternoon’s decision from the Federal Reserve on whether or not to cut rates and guidance from Fed chair Powell on future cuts. Front-month crude oil futures are modestly higher this morning, negating yesterday’s loss, while the U.S. dollar index is trading near unchanged.
USDA reported daily sales of 135,000 MT of corn and 120,000 MT of soybean meal for delivery to Colombia during the 2024-25 marketing year.
The ag sector portion in the continuing resolution (CR) through March 14 echoes what we reported Tuesday. Highlights: A one-year extension of the 2018 Farm Bill, including provisions that don’t have “baseline,” or cost money to extend; $10 billion in farmer financial aid along the lines of a bill introduced by Rep. Trent Kelly (R-Miss.); $21 billion in ag disaster aid for farmers and ranchers ($2 billion specifically for livestock producers) as part of an overall $100.4 billion disaster package; year-round E15 sales and short-term biofuel blending relief to small refiners; language extending authorization of a program that replenishes stolen Supplemental Nutrition Assistance Program (SNAP/food stamp) benefits; and delaying implementation of a “beneficial ownership” database designed to crack down on money laundering until 2026. House Speaker Mike Johnson (R-La.) is expected to turn to Democrats to supply the bulk of votes needed to get the bill to the Senate. It appears lawmakers would have at least a day to review the package.
The Fed is widely expected to cut interest rates another 25 basis points at the conclusion of the two-day monetary policy meeting this afternoon. Focus will be on forward guidance via the Fed’s quarterly summary of economic projections, which will provide forecasts for GDP growth, unemployment, inflation and the Fed funds rate for 2025 and beyond.
France’s ag ministry cut its forecast for 2024-25 French wheat exports outside the EU by 400,000 MT to 3.5 MMT, down 66% from last year. It raised wheat exports within the bloc by 260,000 MT to 6.16 MMT, still 2% below year-ago.
CORN: March corn futures consolidated near unchanged overnight. Initial resistance stands at $4.47 3/4 and is backed by the psychological $4.50 mark, while support comes in at the 10-day moving average at $4.41 3/4.
SOYBEANS: January soybean futures plunged to a fresh contract low overnight. Continued selling pressure finds support at $9.59 1/2 then the psychological $9.50 mark. Resistance stands at $9.70 then the 10-day moving average at $9.83 1/4 on a bounce.
WHEAT: March SRW futures saw corrective strength overnight. Psychological resistance at $5.50 capped overnight strength, while additional buying looks to overcome resistance at $5.57 1/4. Initial support comes in at $5.45, which is reinforced by the contract low of $5.40 1/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a mostly firmer tone, supported by firmer cash cattle trade, though technical headwinds could limit gains after the open. Cash cattle trade took place in Iowa/Minnesota early this week around a dollar higher than last week’s average for the area. Active trade is likely to be pushed late into the week, per usual when there is a Cattle on Feed Report. The recent rally in wholesale beef prices has slowed, with Choice cutout falling $1.74 to $315.63 and Select dipping $1.07 to $288.50. Movement slid to 112 loads despite lower prices, indicating grocers have completed purchases for holiday features.
HOGS: Lean hog futures are expected to open with a mostly firmer tone, supported by strength in the cash cattle market. The CME lean hog index is hinting at a seasonal low, as the index is up 14 cents to $83.98 as of Dec. 16. That is 65 cents above the recent low, while the index has risen three out of the last five days. Traders are anticipating choppy action as February futures are at a discount to the index. Pork cutout fell 50 cents to $94.77 Tuesday, though that remains near recent highs. Losses in butts and ribs led cutout lower.