GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: 8 to 10 cents lower.
Wheat: Winter wheat steady to 2 cents lower; HRS 2 to 4 cents lower.
GENERAL COMMENTS: Soybeans led weakness overnight though corn, soybeans and wheat each pulled back from Monday’s gains. Each saw light volume overnight. Corn and beans were likely weighed down by the rapid planting seen last week. Outside markets are unfavorable this morning, as front-month crude oil futures are trading lower and near recent lows while the U.S. dollar index is trading around 125 points higher.
USDA reported daily export sales of 113,050 MT of corn for delivery to Mexico, with 56,525 MT slated for delivery during 2023-24 and the remaining 56,525 MT for delivery during 2024-25. USDA also reported sales of 110,000 MT of corn for delivery to Spain during the 2023-24 marketing year.
USDA rated the winter wheat crop 49% “good” to “excellent,” down one percentage point from the previous week. The amount of crop rated “poor” to “very poor” held at 18%, though there was a one-point improvement in the lowest category. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop improved 2.7 points to 321.3 on a 3.2-point increase in top producer Kansas. The SRW CCI rating dropped 2.5 points to 383.8, led by a 2.5-point decline in top producer Illinois. Click here for details.
IKAR cut its forecast for Russia’s wheat crop another 2.5 MMT to 83.5 MMT after a “more exact assessment of frost damage and dryness across the south.” Total grain production is now forecast at 132 MMT, down 3 MMT from its prior outlook. The ag consultancy lowered its 2024-25 Russian wheat export projection by 2 MMT to 45 MMT. Total grain exports are now forecast at 57 MMT, down 2.5 MMT.
South American crop consultant Dr. Michael Cordonier left his Argentine crop estimates at 50 MMT for soybeans and 47 MMT for corn, though he has a lower bias toward both amid declining yields as harvest progresses. For Brazil, Cordonnier left his crop forecasts at 147 MMT for soybeans and 112 MMT for corn, with a neutral bias toward both.
CORN: July corn futures gave up a portion of Monday’s gains overnight. Bulls are seeking to overcome resistance at the 10-day moving average, currently at $4.59 3/4, which is reinforced by resistance at $4.65 1/2. Support comes in at $4.55 then Friday’s low of $4.51.
SOYBEANS: July soybean futures saw relative weakness overnight. Resistance stands at $12.48 3/4, the May 6 close, which capped most gains on Monday. Additional resistance lies at $12.56 1/2. Support stands at $12.32 1/4 with significant backing from the 100-day moving average at $12.22 3/4.
WHEAT: July SRW futures saw modest volatility on light trading overnight. Monday’s gains stalled short of last week’s high, implying strong resistance layered from $6.87 up to $6.97. Support comes in at $6.73 with strong backing from $6.64, the 10-day moving average, which capped losses last week.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures and feeders are expected to open with a firmer tone on continued cash fundamental strength. The cash cattle average rose $2.60 last week to $188.54, marking the fourth consecutive week of gains and the third highest quote on record. Despite the cash strength, traders have maintained a pessimistic outlook, which is clear given steep discounts to cash in nearby June futures. Previous runups to highs or near-record highs in the cash market have been followed by a brief period of weaker prices, so it may be difficult to get packers to pay up again this week, especially after buying a lot of cattle recently. Wholesale beef prices were mixed on Monday, as Choice cutout fell 75 cents to $312.7, the first daily decline in over a week. Select rose $1.95 to $299.35.
HOGS: Lean hog futures are expected to open with a mostly firmer tone as seasonal strength and bargain hunting are likely to support prices, though continued technical selling could limit gains after the open. The CME lean hog index is down 7 cents to $92.22 as of May 17. With seasonally tightening market-ready supplies and packer margins in the black, any decline in the cash index should be minor and temporary. Meanwhile, wholesale pork values continue to show moderate strength, as cutout rose 92 cents to $101.77 Monday, driven by strength in ribs and loins. Movement was strong at 327.04 loads.