GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: Steady to 2 cents lower.
Wheat: SRW 2 to 4 cents higher; HRW 3 to 5 cents lower; HRS 3 to 5 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat each saw sustained selling pressure overnight, with soybeans showing relative strength. Daytime trade has brought an increase in selling pressure the past five sessions, key will be a reversal of that pattern. Outside markets are unfavorable this morning, as front-month crude oil futures are trading lower and near four-month lows and the U.S. dollar index is trading around 200 points higher.
USDA rated 75% of the corn crop and 74% of the spring wheat crop as “good” to “excellent,” up 11 points and 10 points, respectively, from year-ago. On the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500-point scale, with 500 representing perfect), the corn crop started the growing season with a rating of 385.6, up 19.9 points from last year at this time. The initial spring wheat CCI rating of 378.6 was up 8.4 points from last year. Click here for details.
Crop consultant Dr. Michael Cordonnier cut 500,000 acres off his corn plantings estimate to 89.5 million acres (harvested acres of 81.7 million) due to wetness concerns in the western Corn Belt. He left his yield estimate at 179 bu. per acre. Cordonnier now forecasts the U.S. corn crop at 14.62 billion bushels. For soybeans, Cordonnier increased plantings 300,000 acres to 86.8 million acres (harvested acres of 85.8 million) and left the yield at 52 bu. per acre. His soybean production forecast is now 4.46 billion bushels.
India is likely to harvest 112.9 MMT of wheat this year, the country’s ag ministry said, up 900,000 MT from its previous forecast. The country’s rice production was estimated at 136 MMT, with total grains output seen at 328.8 MMT.
The forecast for the rest of the week is trending drier than anticipated, which should allow for additional fieldwork to be done, notes World Weather Inc. A ridge of high pressure is advertised to shift into the eastern United States after day ten of the outlook, which could lead to drier and warmer weather for the Midwest and the Great Plains, says the forecaster.
CORN: July corn futures saw continued selling pressure overnight. Resistance stands at $4.46 and is backed by the psychological $4.50 mark. Bulls are seeking to hold support at $4.40, which acted as key support in the first half of April. Further selling pressure would find support at $4.36 1/4.
SOYBEANS: July soybean futures posted modest losses on light volume overnight. Resistance stands at $11.91 3/4 and is backed by the psychological $12.00 mark. Bulls are seeking to hold support at $11.82, a break below which finds support at the psychological $11.75 mark, then $11.72.
WHEAT: July SRW futures continue to fall under selling pressure. Bulls are seeking to overcome initial resistance at $6.79, which capped corrective gains overnight and buying efforts the past two sessions. Further buying eyes stiff resistance at the psychological $7.00 mark. Support stands at the 20-day moving average at $6.68 1/4, which is reinforced by support at $6.51 1/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a firmer tone, continuing Monday’s bounce from technical support. June live cattle futures confirmed trendline support at $181.75 with Monday’s rally, confirming the recent uptrend. While last week’s cash cattle average fell $1.18 from the previous week’s record to $188.91, futures remain well below cash prices, which will likely support prices as well. Wholesale beef prices continue to show relative strength, as Choice cutout firmed $2.40 to $315.60 and Select rose $1.99 to $303.70 on Monday.
HOGS: Lean hog futures are expected to open with a firmer tone on corrective buying, though persistent sellers could lead to weaker trade after the open. Prices continue to be oversold on the daily bar chart, which could spark dip buying on the open, but it has been common for a gap higher to be sold into by midday in the past few weeks. The CME lean hog index is up another 24 cents to $91.73 as of May 31, marking the third consecutive day of gains. Meanwhile, pork cutout dropped $1.82 to $101.43 as all cuts weakened on the day. Movement was relatively light to start the week at 280.43 loads.