Corn producers: Extend 2024-crop sales, make initial 2025-crop sales... March corn futures hit our sales target of $4.75 during the overnight session. While 2024-25 ending stocks are now projected to be borderline tight, we feel it’s prudent to maintain a disciplined approach when sales targets are hit. We advise corn hedgers and cash-only marketers to sell another 20% of 2024-crop production to get to 50% sold in the cash market. We also advise selling an initial 10% of expected 2025-crop production for harvest delivery. Our next upside sales target is the $5.00 level.
GRAIN CALLS
Corn: Steady to 2 cents higher.
Soybeans: Steady to 2 cents higher.
Wheat: SRW 3 to 5 cents higher; HRW 1 to 3 cents higher; HRS steady to 2 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat each favored the upside in overnight trade, though selling pressure increased into the break. Bulls are looking to hold corn and soybean prices above Friday afternoon’s lows to avoid falling back into last week’s sideways range. Outside markets are mixed this morning as front-month crude oil futures continue to make new highs while the U.S. dollar index is around 200 points higher.
USDA reported daily sales of 198,000 MT of soybeans for delivery to China during the 2024-25 marketing year.
Forecasts call for rains to continue across central Brazil during the next two weeks, which could hinder early soybean harvest. Only scattered rains are expected in dry far southern areas of Brazil. Argentina will be hot and dry the bulk of this week, though some temporary relief could come via rains and more seasonal temps Friday and Saturday. There’s potential for some additional rains in Argentina during the second weekend of the two-week outlook.
Brazil’s soybean harvest reached 0.3% as of last Thursday, according to AgRural, behind 2.3% on this date last year. The firm says there’s strong yield potential in central Brazil, though rains are hindering harvest activity and if that continues it could hurt crop quality. Heat and moisture stress is a concern in far southern Brazil. Brazil’s first crop corn harvest reached 1.3%. Safrinha corn planting won’t turn active until soybean harvest accelerates.
China imported 7.94 MMT of soybeans in December, up 790,000 MT (11%) from November but down 1.88 MMT (19.1%) from last year. In 2024, China imported a record 105.03 MMT of soybeans, up 6.5% from the previous year.
CORN: March corn futures posted followthrough gains overnight. Resistance stands at $4.75, which limited the upside overnight. That is backed by $4.81 resistance. Support lies at $4.71 1/2, though that sees little backing until the 10-day moving average at $4.60.
SOYBEANS: March soybean futures saw modest followthrough strength overnight. Bulls are eyeing resistance at $10.33 1/2, which is backed by the Nov. 8 close at $10.43 1/2. Support lies at $10.24 1/4, the 100-day moving average, then $10.15 3/4.
WHEAT: March SRW futures posted impressive gains overnight. Resistance at the 10-day moving average at $5.38 1/4 limited overnight strength. Above that mark, bulls are eyeing resistance at $5.42 1/2. Support lies at $5.30 3/4 then the contract low of $5.26.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/lower.
CATTLE: Live cattle futures and feeders are expected to open higher on continued cash fundamental strength. While February live cattle are over bought on the daily bar chart, the contract continues to trade well under the cash market, which will posted another record high for last week’s average. Strength in wholesale beef prices has limited the strain on packer margins, though cutting margins remain in the red. Choice cutout climbed $2.06 to $332.84 Friday, while Select surged $5.79 higher to $314.14.
HOGS: Lean hogs are expected to open with a mostly weaker tone as premiums to the CME lean hog index are likely to weigh on futures. The CME lean hog index is down another 16 cents to $80.43 as of Jan. 9, the lowest level since the beginning of March. Corrective strength has driven hog futures higher since the middle of last week, but unless the cash market turns around, continued strength is up to question. Pork cutout was up 88 cents to $91.36 Friday, led by strength in bellies. Movement slowed to 250.14 loads, indicating lower demand at higher prices.