GRAIN CALLS
Corn: 1 to 3 cents higher.
Soybeans: 2 to 4 cents higher.
Wheat: 1 to 6 cents higher.
GENERAL COMMENTS: Grain and soybean futures finished mostly firmer overnight. Malaysian palm oil futures rose nearly 3.0%, while Nymex crude oil futures rose slightly. The U.S. dollar index is up around 250 points this morning.
USDA reported a sale of 22,000 MT of soybean oil for delivery to “unknown destinations” during the 2021-22 marketing year.
Consumer inflation hit its highest level in over 30 years during October amid rising costs for gasoline, food and other goods and services, the Labor Department reported today. The consumer price index rose 6.2% from a year ago, higher than economists’ expectations for a 5.9% increase. Stripping out volatile food and energy prices, the so-called core inflation jumped 4.6% versus last year.
La Nina continues to gain strength in the tropical eastern Pacific Ocean and will reach a peak of Intensity in December and January, World Weather Inc. said. The combination of a rapidly developing La Nina and seasonal cooling in North America will lead to a couple of storm systems this week and at least one more next week as cooling air seeps into Canada and the north-central U.S.
In Argentina, much-needed precipitation fell last week after a significantly drier-than-normal October, World Weather said. Planting “is advancing quite favorably and the outlook for crops is not bad for a La Nina year,” the forecaster said. Seeding advanced more swiftly in recent days as producers took advantage of recent rainfall, though much more rain was needed to completely restore soil moisture to normal.
Farm office FranceAgriMer lowered its forecast of French soft wheat exports outside the European Union in 2021-22 season to 9.4 MMT from 9.6 MMT estimated in October.
South Korea purchased 137,000 MT of corn – believed to be South American or South African origin. Japan tendered to buy 80,000 MT of feed wheat and 100,000 MT of feed barley.
CORN: December corn futures overnight rose as high as $5.60 3/4 overnight but remained within yesterday’s range. USDA yesterday raised its estimate for the U.S. corn crop more than expected, to 15.062 billion bu. USDA also hiked its average U.S. yield estimate to 0.5 bu. to a record 177.0 bu. per acre.
SOYBEANS: January soybeans traded in a tight range overnight, well within yesterday’s low and high at $11.81 1/4 and $12.40 3/4, respectively. USDA’s unexpectedly cut to its U.S. soybean crop estimate yesterday, which sparked a corrective rally, though prices settled at the middle of the day’s range.
WHEAT: Spring wheat futures led overnight gains, with the December contract reaching a high for the week at $10.32. December SRW rose as high as $7.85 3/4, also a high for the week. USDA’s Supply and Demand Report yesterday underscored the tightening supply outlook, with global 2021-22 wheat ending stocks reduced 0.5% to 275.87 MMT, a larger reduction that traders anticipated.
LIVESTOCK CALLS
CATTLE: Steady-mixed
HOGS: Steady-weaker
CATTLE: Futures await direction from the cash cattle market after the December contract eked out a second straight daily gain but deferreds ended lower on Tuesday. Feedlots are seeking higher prices this week, but meatpackers haven’t stepped in as aggressively and only a limited number of cattle have traded at roughly steady prices. Choice beef cutout values fell 85 cents today to an average of $287.80. USDA yesterday raised U.S. beef production from October on higher expected slaughter and heavier carcass weights but boosted its estimate live steer price for 2021 by 25 cents to $121.31, up 12% from 2020. December live cattle yesterday rose 10 cents to $132.20, the highest closing price in over two months. Chart levels to watch include this week’s intraday high at $132.50, also a two-month high, and the 100-day moving average around $131.20.
HOGS: Slumping cash fundamentals may continue to burden hog futures. After a brief rally last week, pork cutout values tumbled sharply back near eight-month lows. Cutout values yesterday fell $2.31 to an average of $92.55. A recent uptick in the CME lean hog index may also be short-lived, with the latest quote down 6 cents at $79.23. Carcasses on national direct markets fell 37 cents to $58.66. December lean hog futures fell $1.425 yesterday to $74.95, the lowest closing price in a week. Chart levels to watch include last week’s low at $74.075 and the 20-day moving average around $75.75.