GRAIN CALLS
Corn: Steady to 2 cents lower.
Soybeans: 10 to 13 cents higher.
Wheat: 6 to 8 cents lower.
GENERAL COMMENTS: Soybeans continue to surge, trading at the highest level in nearly two months overnight. Corn traded in a tight range and went into the break steady, while wheat favored the downside. Bond yields ticked higher overnight, helping stabilize the U.S. dollar index near unchanged. Front-month crude oil futures rallied overnight, giving some spillover strength to grains.
Brazil’s soybean planting reached 51% complete as of last Thursday, according to AgRural. That was behind last year’s 57% at this point last year and the slowest pace since 2020-21. Heavy rains and flooding last week will require some replanting of soybeans in southwest and central-south areas of Paraná, the firm said.
Central areas of Mato Grosso and Minas Gerais reported locally heavy rainfall Friday into Saturday while other center-west and center-south crop areas in Brazil reported scattered showers of light to moderate intensity. Southern Brazil experienced drier weather during the weekend, but waves of rain will be returning later this week. Center west and center south Brazil rainfall is expected to be erratic and lighter than usual during the next 10 days while temperatures will be warm, according to World Weather Inc. Argentina is expected to see mostly favorable weather during the next two weeks.
The ongoing debate over immigration and border policies is having a major impact on congressional discussions about government spending and emergency aid packages. Republicans are pushing for changes in immigration policies aimed at deterring illegal border crossings. They want to address border security issues and make it more difficult for migrants to enter the U.S. without proper documentation. Democrats, including President Joe Biden, emphasize the need to allocate $13.6 billion to manage the increasing number of migrant arrivals. They argue this funding is essential to address the current challenges at the border. The debate over immigration is causing tensions in Congress, particularly as it relates to funding for Ukraine and other foreign aid initiatives. There is a risk that disagreements over immigration policies could lead to delays or the derailment of government spending and aid packages.
This morning, USDA announced daily sales of 289,575 MT of corn for delivery to Mexico and 126,000 MT of soybeans for delivery to China, both during the 2023-24 marketing year.
CORN: December corn futures continue to struggle with resistance at last week’s supply zone above $4.80, coinciding with 10-day moving average resistance at $4.79. Further resistance lies at last week’s high of $4.84 1/4. Bulls are seeking to hold reclaimed support at $4.74, backed by the $4.70 mark.
SOYBEANS: January soybean futures continue to break out to the upside as prices traded to the highest level in nearly two months. Bulls are targeting resistance at $13.75, backed by significant downtrend line resistance at $13.90. Bulls are looking to hold support at $13.50 on a bout of corrective buying, which is firmly backed by $13.33 3/4.
WHEAT: December SRW futures saw profit-taking overnight as prices failed to overtake the 20-day moving average, currently at $5.72 1/2. This will stand as initial resistance and is backed by the 40-day moving average, which capped the rally in October, currently at $5.82 1/2. Bulls are seeking to hold support at $5.63 1/4, else a trip to $5.56 1/2 is likely.
LIVESTOCK CALLS
CATTLE: Choppy/lower.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mostly weaker tone, though technical buying and the release of last week’s cash average released late morning could limit selling. Volume in cash cattle trade remained limited into Friday as feedlots passed on steady bids, opting to carry cattle forward to this week. While that may increase the amount of cattle feedlots have to move this week, the underlying belief among some cash sources remains that cash cattle prices will firm. Wholesale beef prices slipped on Friday as Choice fell $2.19 to $302.34 and Select dropped $2.33 to $272.01.
HOGS: Lean hog futures are expected to open mostly higher, continuing the recent steep uptrend on the daily bar chart. While December futures saw profit-taking on Friday, bulls retain an uptrend on the daily chart. That uptrend is steep and prices closed on support Friday afternoon, leaving room for potential further consolidation this morning. The CME lean hog index continues its seasonal decline as it fell 39 cents today to $76.45 (as of Nov. 2), the steepest drop in four days. The spread between December futures and the index remains at a tight $4.70. Continued sustained weakness in cash prices would challenge trader’s belief that the seasonal bottom will come earlier than the past few years. Wholesale pork prices slipped 13 cents on Friday to $87.28, though the cutout remains largely sideways over the past three weeks.