GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 2 to 4 cents higher.
Wheat: 2 to 4 cents lower.
GENERAL COMMENTS: Positioning drove trade in the overnight session with soybeans showing modest strength and wheat leading weakness. Selling interest increased into the break as export sales for each came below expectations. Outside markets are volatile this morning as front-month crude oil futures are solidly higher and trading near a six month high. The dollar index is over 500 points higher, supported by higher long-term interest rates.
The U.S. jobs market continues to run hot, adding 256k jobs in December, the most in nine months. That topped last month’s revised (lower) figure of 212K jobs and topped expectations of 160k. Bureau of Labor Statistics reported the unemployment rate at 4.1% in December, down from 4.2% the previous month and below expectations of 4.2%. Hotter than expected jobs numbers draws into question the Federal Reserves ability to cut interest rates in the near future, driving interest rates higher, which weighed heavily on equity markets this morning.
Today is one of the biggest report days of the year for the grain markets as USDA will release its Annual Production Summary, monthly Supply & Demand Report, Quarterly Grain Stocks and Winter Wheat Seedings at 11:00 a.m. CT. Much of the focus will be on USDA’s “final” crop estimates for corn and soybeans. But Dec. 1 grain stocks have a history of providing market-moving surprises, especially for corn. Click here to view pre-report expectations.
Reuters reported the Biden administration plans to issue short-term guidance for the 45Z production credit today, citing two people familiar with the situation. The report also reiterated previous information that the Trump administration is expected to finalize the rules for the credit, which took effect on Jan. 1. The delay in releasing guidance has caused significant uncertainty in the biofuels industry. Many producers have expressed concerns about potential production shutdowns or reduced operations due to the lack of clarity on the 45Z credit. Some industry groups previously requested a one-year extension of the now-lapsed biodiesel and renewable diesel tax credit to provide stability during this transition period, but there has been no movement on the request.
Export sales for the week ended Jan. 2:
- Corn: Net sales of 445,000 MT for 2024-25 — a marketing year low, down 43% from the previous week and 61% from the four-week average. Increases came primarily for Colombia and Japan. Sales came below expectations ranging from 700,000 MT to 1.4 MMT. Exports of 863,700 MT.
- Soybeans: Net sales of 288,700 MT for 2024-25 — a marketing year low, down 40% from the previous week and 72% from the four-week average. Increases came primarily for the Netherlands and China. Sales were below expectations ranging from 400,000 MT to 1.3 MMT. Exports totaled 1.580 MMT, with the bulk of the total being shipped to China.
- Wheat: Net sales of 111,300 MT for 2024-25 — a marketing year low, down 21% from the previous week and 70% from the four-week average. Sales came below expectations ranging from 150,000 to 500,000 MT. Exports totaled 414,300 MT.
CORN: March corn futures’ range continues to tighten. Bulls are eyeing initial resistance at $4.58 before tackling the recent for-the-move high of $4.60 1/4. Support stems from the 10-day moving average of $4.54 1/4 then the psychological $4.50 mark.
SOYBEANS: March soybean futures continue to trade sideways. Bulls struggled to push prices much above the $10.00 mark overnight. Bulls are looking to overcome the Jan. 2 high of $10.15 3/4 on report driven strength. Support comes in at $9.96 1/2, the 10-day moving average, then $9.85 on selling pressure.
WHEAT: March SRW futures continue to see relative weakness. Support stems from $5.27 1/2, the contract low, which is quickly backed by the psychological $5.25 mark. Resistance stands at $5.38 1/4, the 10-day moving average, then $5.42 1/2 on report driven strength.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open higher in a continuation of yesterday’s strength. Live cattle and feeder futures surged on reports of cash cattle trading as much as $4.00 to $5.00 higher on Thursday, which would push cattle prices to another record. Packers continue to actively pursue animals despite negative cutting margins, which has led to explosive futures gains. Wholesale beef prices worked higher Thursday as well, with Choice climbing $2.17 to $330.78 and Select firming $1.46 to $308.35. USDA reported net beef sales of 5,600 MT for 2025 with reductions of 800 MT carried over from 2024.
HOGS: Lean hog futures are expected to open with a mostly firmer tone, driven by technical buying. February futures boasted strong gains on Thursday, continuing higher from Wednesday’s rebound from recent lows. Continued weakness in the cash hog market could limit gains, as the CME lean hog index is down another 46 cents to $80.59 as of Jan. 8. February lean hogs finished Thursday $1.185 above today’s cash quote, erasing the recent discount. Pork cutout fell a nickel to $90.48, led by losses in picnics, though movement remained firm at 412.38 loads. USDA reported net pork sales of 31,000 MT for 2025 and 500 MT in carry-over sales from 2024.