GRAIN CALLS
Corn: Steady to 2 cents lower.
Soybeans: 1 to 3 cents lower.
Wheat: 2 to 4 cents higher.
GENERAL COMMENTS: Corn and wheat saw relative strength most of the overnight session, though saw heightened selling pressure into the break. Soybeans favored the downside though traded within Wednesday’s range. Annual inflation, as measured by the consumer price index (CPI), slowed less than expected in September. CPI slowed to 2.4%, the lowest since Feb. 2021 and below 2.5% in August. Forecasts called for inflation slowing to 2.3%. Inflation in shelter pulled inflation higher than expected. Outside markets are mixed this morning as front-month crude oil futures are trading higher and the U.S. dollar index is around 400 points higher.
Hurricane Milton made landfall as a Category 3 storm late Wednesday along the west-central Florida Gulf Coast and quickly ripped through the middle of the state before moving off the east-central coast prior to dawn, leaving behind widespread damage. World Weather Inc. note, “Preliminary wind data suggests widespread citrus fruit droppage should have occurred as a result of the storm’s excessive wind and the odds are good that flooding has many fruit and vegetable crops that are produced close to the ground at least vulnerable to damage.”
Milton shifted south of the Tampa area just before making landfall, keeping the brunt of the storm from the major phosphate production areas in the state. There was damage to phosphate production and storage, but it likely wasn’t as bad as it could have been. Mosaic idled their Florida operations mining for phosphate rock used in fertilizer production ahead of the storm. As much as 42% of U.S. ammonium phosphate, 32% of U.S. phosphate rock and half of U.S. wet-processed phosphoric acid production capacity is located near Tampa Bay, according to Veronica Nigh with The Fertilizer Institute, with 40% of all U.S. phosphate fertilizer exports and 27% of total fertilizer exports moving through the port of Tampa Bay. “Certainly, the impact of these hurricanes is going to continue to lead to elevated phosphate prices for the foreseeable future,” Nigh said.
Supply chains are slowly catching up and ship queues outside major East Coast and Gulf ports are down from their peaks after last week’s three-day strike by dockworkers. According to a Bloomberg tally using vessel tracking data, the number of ships queued outside Atlantic and Gulf ports stood at 25 as of Wednesday, down from a peak of 49 on Oct. 4.
Export sales for the week ended Oct. 3:
Corn: Net sales of 1.222 MMT for 2024-25 were primarily for unknown destinations and Mexico. Sales were within analysts’ expectations of 900,000 MT to 1.7 MMT. Exports totaled 1.059 MMT with over half of that total going to Mexico.
Soybeans: Net sales of 1.264 MMT for 2024-25. Increases came primarily for China and the Netherlands. Sales were within the expected range from 800,000 MT to 1.7 MMT. Exports totaled 1.705 MMT, with 704,200 MT shipped to China.
Wheat: Net sales of 433,600 MT for 2024-25, which were down 2% from the previous week but up 31% from the four-week average. Mexico led purchases. Sales came near the upper end of expectations ranging from 250,000 to 550,000 MT. Exports totaled 359,700 MT.
CORN: December corn futures continue to see profit-taking. Bulls are looking to overcome resistance at $4.25, while the downside has largely been capped by support at $4.20. Further selling find support at the 20-day moving average at $4.18 1/4.
SOYBEANS: November soybean futures traded within Wednesday’s range overnight. Resistance stems from the overnight high of $10.25 1/2, which is quickly reinforced by the 40-day moving average at $10.27 3/4. Support lies at $10.15 then Tuesday’s low of $10.11 1/2.
WHEAT: December SRW futures continue to grind higher. Initial resistance stands at $6.09 1/4 with further backing from the Oct. 2 for-the-move high close of $6.15 1/4. Uptrend support comes in at $5.96 1/2, which is reinforced by the 20-day moving average at $5.88 1/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/lower.
CATTLE: Live cattle futures and feeders are expected to open mostly higher, supported by technical buying. Cash cattle negotiations have yet to get underway as packers are hoping to buy cattle at lower prices after four weeks of strength and feed lots are holding out for firmer bids. Choice cutout continues to firm, which has helped packer margins, though they remain well in the red. Choice beef climbed $1.34 to $308.18 Wednesday while Select inched up 2 cents to $288.63. Movement was quite strong at 189 loads, indicating continued robust grocer demand. USDA reported net beef sales of 13,700 MT for 2024, down 39% from the previous week and 8% from the four-week average.
HOGS: Lean hog futures are expected to open with a mostly weaker tone in a continuation of yesterday’s technical selling pressure. The CME lean hog index is up 25 cents to $84.47 as of Oct. 8, though continues to chop in the middle of the recent choppy range. The index is quoted 46 cents above the Sept. 27 low and 43 cents below the Oct. 2 high. Cutout continues to stick near the $95.00 mark, climbing 74 cents to $95.20 Wednesday, led by strength in bellies. Movement totaled 308.4 loads. USDA reported net pork sales of 50,600 MT for 2024, up 17% from the previous week and 56% from the four-week average, with Mexico accounting for 54% of the business.