GRAIN CALLS
Corn: 2 to 4 cents lower.
Soybeans: 13 to 15 cents lower.
Wheat: SRW 5 to 7 cents lower; HRW 6 to 8 cents lower; HRS 4 to 6 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat each favored the downside overnight, with soybeans leading the way lower as a Trump victory has traders cautious about longer-term impacts to trade. Buying interest perked up into the break for all three. Outside markets saw heightened volatility overnight following the election, with the U.S. dollar index exploding higher, currently up around 1900 points. Front-month crude oil futures are facing modest selling pressure, bonds are sharply lower and U.S. stock futures are trading at record highs.
Donald Trump won all battleground states in a virtual red wall while the blue wall (Pennsylvania, Michigan and Wisconsin) cratered for Democratic challenger Kamala Harris as she faced the greatest political comeback in U.S. history. Trump also won battleground states of North Carolina and Georgia and was close in Nevada and Arizona, two states not yet officially called. It appears Trump will eventually garner over 300 electoral votes. Republicans did much better than most expected in Senate races, with a total of 53-56 seats, up from their 49 total in the current Congress. Several House races are still too close to call, but it appears Republicans will hold on to its narrow majority in the chamber. However, Democrats were leading in some close races and several California races could still tip the House chamber to Democrats. If the GOP keeps control of the chamber, that means another contentious House Speaker vote and perhaps changes in its rules.
Trump’s victory rippled through global markets, as U.S. stock futures rallied, Treasury bonds tumbled (yields jumped), the U.S. dollar surged the most since 2020 and commodities faced broad selling pressure. The knee-jerk market reaction signals investors believe a second Trump administration will look a lot like the first one: a stream of policies (tax cuts, deregulation, tariffs) that will simultaneously stoke economic growth, corporate profits and inflation.
China will work with the U.S. on the basis of mutual respect, it said on Wednesday as it braced for Donald Trump returning to the White House, but strategists said Beijing was expecting battles over trade, technology and security issues. China’s foreign ministry said, “Our policy towards the U.S. is consistent. We will continue to view and handle China/U.S. relations in accordance with the principles of mutual respect, peaceful co-existence and win-win cooperation.” Trump has proposed tariffs on Chinese imports of 60% or more and ending China’s most-favored-nation trading status. Analysts say the prospect of a trade war has rattled China’s leadership.
CORN: December corn futures trended lower overnight. Losses were limited by support at $4.15, while additional support lies at the 40-day moving average at $4.13 3/4. Bulls are looking to overcome resistance at $4.18 1/2, which is reinforced by $4.21.
SOYBEANS: January soybean futures saw heavy selling pressure overnight. Bulls are seeking to keep prices above support at the Oct. 30 low of $9.77 1/4 with modest support at the overnight low of $9.82 on the way. Resistance stands at $9.94 then the 20-day moving average at $10.02 1/2, which capped gains the past three sessions.
WHEAT: December SRW futures saw sustained selling pressure overnight. Downtrend line support capped losses at $5.62, which is backed by support at the Oct. 28 low of $5.57 3/4. Bulls are seeking to close prices above 10-day moving average resistance at $5.70 1/2.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Lower.
CATTLE: Live cattle and feeders are expected to open with a mostly firmer tone as December futures continue to see strong support around last week’s lows. December futures continue to consolidate above last week’s low, likely supported by steep discounts to cash cattle prices. Wholesale beef prices were mixed on Tuesday as Choice cutout climbed 30 cents to $317.21 and Select dipped $1.92 to $285.24. Packer margins have tightened but are still mildly in the black. After red ink for much of this year, packers will do all they can to keep margins in the black, which means they will control throughput and likely try to get cattle bought at lower prices this week.
HOGS: Lean hog futures are expected to open lower in a continuation of this week’s selling pressure. Despite continued contra-seasonal strength in the cash market, December hogs have sustained heavy selling pressure as traders anticipate a resurgence in seasonal weakness in the coming weeks. The CME lean hog index is up another 41 cents to $89.79 as of Nov. 4, the 13th consecutive daily gain and the highest level since Aug. 16. Weakness in cutout likely played a role in futures’ weakness Tuesday, as cutout dropped $2.58 to $101.43, led by weakness in bellies and loins, though movement remains firm at 317.51 loads.