GRAIN CALLS
Corn: 6 to 9 cents higher.
Soybeans: 22 to 27 cents higher.
Wheat: HRW and SRW 32 to 36 cents higher, spring wheat 23 to 27 cents higher.
GENERAL COMMENTS: December corn futures surged to a high for the month overnight and soybeans and wheat also rallied as stepped-up Russian attacks on Ukraine fueled concerns over disruptions to grain shipments out of the Black Sea. Front-month crude oil is modestly lower after earlier climbing to a six-week high above $93 per barrel. U.S. stock index futures signal a mixed open and the U.S. dollar index is up about 200 points.
Russia struck cities across Ukraine during rush hour on Monday morning, killing civilians and destroying infrastructure in apparent revenge after Russian President Vladimir Putin declared an explosion and fire on the only bridge linking mainland Russia to Crimea to be a terrorist attack. Meanwhile, Belarusian President Alexander Lukashenko said he had ordered troops to deploy with Russian forces near Ukraine in response to what he said was a clear threat to Belarus from Kyiv and its Western allies.
United Nations aid chief Martin Griffiths today voiced confidence that a deal allowing Ukrainian Black Sea grains exports could be extended and even expanded despite an escalation of tensions between Russia and Ukraine. “Our view at the UN is we of course should seek its renewal, and I’m reasonably confident that we will see it (renewed) but also that it needs to go beyond a four-month cycle. We need to see it renewed for a year,” Griffiths said.
Brazilian farmers have sowed an estimated 9.6% of the estimated soybean area, below last year’s 10.1% level as erratic weather is disrupting the work in some areas, according to agribusiness consultancy Agrural. “Constant rains and high humidity continue to predominate in Parana, Santa Catarina and Mato Grosso do Sul states, preventing further advances of the machines,” AgRural said. In Brazil’s top soybean state of Mato Grosso, “scant rainfall and low soil moisture limits the pace of planters, especially in the mid-north of the state,” AgRural noted. Despite some initial hiccups, Brazil is expected to harvest a record soybean crop above 150 MMT in 2022-23, with farmers expanding plantings to almost 43 million hectares (106 million acres), according to a Reuters poll.
China’s hog futures jumped today after a surge in demand during the week-long National Day holiday pushed prices higher. Dalian January hog futures posted the biggest daily gain since hog futures were launched last year. China’s state planner said on Sunday it will release its fifth batch of pork reserves, without specifying the amount. In September, China sold 200,000 MT of pork from state reserves in an attempt to ease rising prices.
Algeria tendered to buy a nominal 50,000 MT of optional origin soft milling wheat.
CORN: December corn overnight reached $6.95, the contract’s highest intraday price since $6.96 1/4 on Sept. 30. The contract faces stiff resistance around the September high at $6.99 1/2. USDA’s weekly crop progress report will be delayed until Tuesday due to today’s Columbus Day holiday.
SOYBEANS: November soybeans overnight rose to $13.96 3/4, the contract’s highest intraday price since $14.25 3/4 on Sept. 30. The contract gained 3 3/4 cents last week, the first weekly gain in three. USDA’s monthly Crop Production update Oct. 12 will be one key to price direction this week. Based on a Reuters survey, USDA is expected to raise its U.S. soybean crop estimate about 3 million bu. to 4.381 billion bu.
WHEAT: December SRW wheat overnight reached $9.24 1/4, the contract’s highest intraday price since Oct. 4. The contract fell 41 1/4 cents for the week, the first weekly decline in three.
LIVESTOCK CALLS
CATTLE: Steady-firmer
HOGS: Steady-weaker
CATTLE: Live cattle futures may extend last week’s gains behind expectations for continued firmness in the cash market. USDA-reported live steers averaged $145.97 through Friday morning, up from the previous week’s average of $144.78. However, October live cattle futures finished Friday just modestly above the previous week’s average cash price, signaling traders remain cautious. Considering tightening supplies and current feedlot conditions, the cash market should continue a general firming tone. Choice beef cutout values ended last week at $246.07, up $2.32 from a week earlier but still near an 18-month low of $243.75 posted Sept. 30. December live cattle futures rose 17.5 cents Friday to $148.05, up $1.00 for the week.
HOGS: Lean hog futures may face pressure from continued weakness in cash fundamentals. The CME lean hog index is down 12 cents to $92.65 (as of Oct. 6), an eight-month low. October futures finished Friday 30 cents above today’s cash index quote, suggesting traders sense a short-term rebound in the cash market is ahead. But December futures ended last week $15.50 below the cash index, signaling pessimism through the end of this year. Wholesale pork continued to strengthen last week, with pork cutout values rising 13 cents to $101.54, up from $97.59 at the end of last week. December lean hogs fell 62.5 cents Friday to $77.15, up 92.5 cents for the week.