GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: Steady to 3 cents lower.
Wheat: SRW 1 to 3 cents lower; HRW steady to 2 cents higher; HRS steady to 2 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat each saw corrective buying overnight though saw renewed selling pressure into the break. Markets failed to bounce despite heavy selling in Friday’s abbreviated, low volume session, indicating likely further weakness. Front-month crude oil futures are modestly weaker while the U.S. dollar index is trading around 100 points lower.
Brazil will see daily rains during the next two weeks, though much of the rain will struggle to counter evaporation rates, according to World Weather Inc. Still, rains should be enough to support crops in some areas. Additional rainfall will be needed for sustained crop development. Weather in Argentina is expected to be mostly favorable during the next two weeks.
Brazil’s soybean planting stood at 74% done as of last Thursday, according to AgRural, behind 87% on that date last year and the slowest since 2015-16. Excessive moisture continues to slow planting progress in the far southern state of Rio Grande do Sul. Recent rains have improved conditions in top producer Mato Grosso following prolonged dryness, though more will be needed for favorable crop development.
Congress returns this week and lawmakers have a host of work they have punted on, including fiscal year 2024 funding, a new farm bill and Ukraine aid. The economic focus will be Thursday’s personal consumption expenditure price index, the Fed’s preferred inflation gauge, for October. Other key economic data will be the second estimate of third quarter GDP, along with the Fed’s Beige Book highlighting economic activity in the 12 districts, both of which are scheduled for Wednesday. The highlight for agriculture will be USDA’s updated farm income forecasts on Thursday.
CORN: December corn futures saw light corrective buying overnight but have since turned lower. Bulls are seeking to hold resistance at $4.61 with little backing until $4.53 3/4. Bears are seeking to hold initial resistance at $4.63 1/4 on a bout of corrective buying, backed by the overnight high of $4.65 3/4, then $4.68 1/4.
SOYBEANS: January soybean futures saw tepid corrective buying overnight. Bulls are looking to hold support at $13.29, a break below which confirms a breakdown from a bearish head and shoulders pattern on the daily bar chart. Little additional support stands until the $13.20 mark. Bulls are eyeing resistance at $13.41 1/4, then $13.48 1/4.
WHEAT: December SRW futures traded within Friday’s range overnight, though failed to hold the overnight gap higher. Initial resistance stands at $5.56 with firmer backing at $5.62 1/4, while bears are eyeing a break of the overnight low of $5.46 1/2, backed by the contract low at $5.40.
LIVESTOCK CALLS
CATTLE: Choppy/lower.
HOGS: Choppy/lower.
CATTLE: Live cattle futures are expected to open with a mostly weaker tone in continuation of Friday’s weakness. Cash cattle trade continues to disappoint, with last week’s price likely to fall, as the average up until Friday’s trade was $176.99, 83 cents below the prior week. Sharp futures losses likely pushed cash cattle trade lower as well. Meanwhile, corrective buying and a stronger wholesale beef market, which saw Choice rising $1.03 and Select up $1.14 to $268.76, could limit selling pressure.
HOGS: Lean hog futures are expected to open mostly lower, though the discount nearby futures hold to the CME lean hog index could limit selling pressure. The index, which fell 30 cents to $73.60 today (as of Nov. 22), currently stands at a $6.025 premium to December futures, which expire on Dec. 14. Traders anticipate deteriorating cash prices up until that point, though the discount already seen could limit futures’ losses. Wholesale beef prices slipped 51 cents to $84.17 Friday, a fresh for-the-move low, led lower by picnics.