GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 4 to 6 cents higher.
Wheat: SRW 1 cent lower to 1 cent higher; HRW 1 to 3 cents lower; HRS 1 to 3 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat posted corrective gains most of the overnight session though saw an increase in selling pressure into the break. Outside markets are favorable this morning as front-month crude oil futures are seeing strong corrective buying and the U.S. dollar index is trading over 500 points lower.
USDA reported daily sales of 104,572 MT of corn for delivery to unknown destinations during the 2024-25 marketing year.
The Fed will conclude its two-day monetary policy meeting by keeping interest rates unchanged. Particular attention will be on the post-meeting comments and Chair Jerome Powell’s press conference to see if there are any strong indications of when the Fed will start cutting interest rates, which many believe will be in September.
A letter from a dozen Senators, including Democrats and Republicans, urged Treasury Secretary Janet Yellen to ensure that only domestic ingredients can receive biofuels tax credits. The bipartisan push underscores the mounting pressure on the Biden administration to halt the flood of foreign used cooking oil that lawmakers say threatens American farmers and the intention of President Joe Biden’s landmark climate law. “Allowing U.S. tax credits to fund the importation and use of foreign feedstocks to produce biofuels would put U.S. agriculture at the back of the line, while foreign agricultural producers are subsidized by U.S. taxpayers,” the letter stated. The senators are calling on Yellen to issue final guidelines for the Clean Fuel Production Credit, known as 45Z, under the Inflation Reduction Act before Jan. 1, when the tax incentive is set to take force. The lawmakers contend guidance for the current sustainable aviation fuel tax credit known as 40B, which expires at the end of this year, is flawed because no domestically produced ethanol can meet its requirements.
Ukrainian grain traders union UGA cut Ukraine’s 2024 combined grain and oilseeds crop forecast by 2.8 MMT to 71.8 MMT due to a heatwave across the country. UGA said production could include 23.4 MMT of corn, 19.8 MMT of wheat, 4.95 MMT of barley, 12.8 MMT of sunseeds, 4.8 MMT of soybeans and 4.3 MMT of rapeseed.
CORN: December corn futures saw relative weakness overnight. Initial resistance stems from the 10-day moving average at $4.10 3/4 and is backed by $4.16. Stiff support lies at the July 12 low at $4.03, which has capped the downside since that mark. Further selling seeks to overcome psychological support at $4.00.
SOYBEANS: November soybean futures saw corrective gains overnight. Bulls are looking to overcome initial resistance at $10.31 3/4 before tackling stiff resistance at $10.47 1/4, the 10-day moving average. Support stems from Monday’s low of $10.18 then $10.09.
WHEAT: December SRW futures saw modest losses overnight as the recent range continues to tighten on the daily bar chart. Bulls are targeting a daily close above downtrend resistance at $5.55 with further buying looking to overtake resistance at $5.59 1/2. Support lies at $5.47 with further selling finding support at the contract low at $5.39 1/2.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open higher, building on Tuesday’s strength. Cash cattle trade has been slow to develop so far this week after packers raised bids and purchased a relatively large amount of cattle last week. Bids and asking prices have yet to surface this week. Showlists are higher in Kansas, Nebraska and Colorado and most cash sources expect steady/weaker prices once trade develops. Wholesale beef ended Tuesday lower, as Choice cutout fell 33 cents to $314.48 and Select sunk 14 cents to $301.38.
HOGS: Lean hog futures are expected to open with a mostly firmer tone on continued strength in the CME lean hog index. The index is up another 30 cents to $92.59 as of July 29, eclipsing the mid-May high. Instead of what appeared at the time to be an earlier-than-normal seasonal peak, the cash index will now post a later-than-typical top. August lean hog futures finished Tuesday at a $1.39 discount to the cash index, suggesting traders sense a seasonal top will be posted soon. Wholesale pork prices weakening on Tuesday support that claim, as cutout fell $1.18 to $105.60 as all cuts except ribs posted losses on the day.