GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: 1 to 3 cents lower.
Wheat: 5 to 7 cents lower.
GENERAL COMMENTS: Wheat led weakness overnight with corn and soybeans following to the downside. Selling pressure picked up in each as the overnight session went on. Front-month crude oil futures marked a fresh three-month high overnight but are well off session highs now. The U.S. dollar index is around 650 points higher and nearing last week’s high.
USDA reported daily sales of 120,000 MT of soybeans for delivery to unknown destinations during the 2024-25 marketing year.
President-elect Donald Trump is considering declaring a national economic emergency to provide legal ground for universal tariffs, CNN reports, citing people familiar with the matter. The declaration would allow Trump to set up a new tariff program by using the International Economic Emergency Powers Act.
Trump refused to rule out using military force to acquire Greenland and the Panama Canal, citing their importance to American economic and national security. Trump has long expressed interest in purchasing Greenland, a Danish territory, describing it as “absolutely necessary” for U.S. security. He also raised concerns over the Panama Canal, claiming its current operation by Chinese interests undermines American control of a critical trade route. He also said the Gulf of Mexico should be renamed the “Gulf of America,” reflective of the U.S. role in the region. Renaming an international body of water, however, would require consensus among bordering nations, including Mexico and Cuba, making unilateral action by the U.S. improbable. But the proposal underscores Trump’s push for assertive rebranding of U.S. influence in the region. Trump also amplified his controversial remarks about integrating Canada into the United States, suggesting the use of “economic force.”
Sen. Chuck Grassley (R-Iowa) intensified his criticism of EPA over its method for verifying used cooking oil (UCO) imports. With a record 3.2 billion pounds of UCO imported through August 2024 — enough to displace 270 million bu. of soybeans — concerns are mounting about the impact on American farmers, the renewable fuel industry, and broader trade and environmental issues. Grassley criticized EPA for relying heavily on foreign records to verify compliance with the Renewable Fuel Standard (RFS), calling the approach inadequate. There are fears that imported UCO may be fraudulently blended with virgin vegetable oils, such as palm oil, undermining U.S. tax incentives. Grassley and other senators are demanding a more robust and transparent verification process to ensure the integrity of the RFS and safeguard American interests.
CORN: March corn futures continue to consolidate near recent highs. Support stems from the 10-day moving average at $4.54 then the psychological $4.50 mark. Bulls are seeking to overcome Monday’s for-the-move high of $4.60 1/4.
SOYBEANS: March soybean futures saw modest selling pressure overnight. Support stems from $9.89 with additional weakness looking to challenge $9.79 1/4 support. Resistance stems from the 40-day moving average at $9.98 1/2 then the Jan. 2 close of $10.12.
WHEAT: March SRW futures led weakness overnight. Additional selling pressure finds tentative support at $5.33 though bears are likely targeting the contract low of $5.27 1/2. Resistance comes in at $5.42 1/2 then the psychological $5.50 mark on a bounce.
LIVESTOCK CALLS
CATTLE: Choppy/lower.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a mostly weaker tone, driven by profit-taking. February futures have had low to mid-range closes for three consecutive sessions, indicating stiff overhead resistance. While the cash cattle market remains supportive, packers actively slowing slaughter runs and news that cattle imports from Mexico could resume in a couple weeks are negative cash market elements. Wholesale beef prices were mixed on Tuesday as Choice cutout fell $1.31 to $325.79 while Select firmed $2.10 to $305.43. Movement stayed strong at 156 loads, indicating robust grocer demand.
HOGS: Lean hog futures are expected to open with a modestly firmer tone, driven by short-covering. February futures are nearing oversold territory and deferred futures have showed relative strength the past couple of days, which is likely to support nearby February hogs today. The CME lean hog index is down another 42 cents to $81.59 as of Jan. 6, though that is not near as steep as the past couple of days. Pork cutout climbed 57 cents to $88.40 Tuesday, ending the recent string of weakness. Gains in bellies led cutout higher, as they continue to show relative strength.