GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 1 to 3 cents higher.
Wheat: SRW 1 to 3 cents higher; HRW steady to 2 cents higher; HRS 3 to 5 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat favored the upside on the overnight open but saw selling pressure as the session went on. Wheat held onto gains, but corn and soybeans went into the break near unchanged. Outside markets are relatively quite, as the U.S. dollar index is around 250 points lower and front-month crude oil futures are trading near unchanged. The recent rally in bonds has added some risk premium back into the market, though rates are higher to start the day as the 10-year treasury is currently fetching 4.69%.
The House leadership saga continues, with Rep. Jim Jordan (R-Ohio) being the latest nominee to be speaker, though he faces an uphill battle. The House will reconvene at 5:00 p.m. CT today with a proposal to make Rep. Patrick McHenry (R-N.C.) temporary speaker gaining steam. Until Republicans can unite around a speaker candidate, the House is poised to remain unable to conduct business, including the next steps for any new farm bill yet this year. Several Federal Reserve officials, including Chair Jerome Powell, will give speeches this week, which the market hopes will give clues to future interest rate decisions. Key agricultural data this week will be this afternoon’s harvest progress for corn and soybeans, along with Friday’s Cattle on Feed Report.
Israeli forces kept up their attacks of Gaza on Monday after diplomatic efforts to arrange a ceasefire to allow foreign passport holders to leave and aid to be brought into the area failed. While the fighting is intensifying, market reaction remains relatively muted.
Traders expect the National Oilseed Processors Association (NOPA) to report its members crushed 161.7 million bu. of soybeans during September. If realized, that would be up 0.1% from August, 2.5% above last year and a record for the month. Soyoil stocks are expected to total 1.208 billion lbs. at the end of September.
Russia’s IKAR agriculture consultancy raised its forecast for Russia’s grain crop by 400,000 MT to 141.6 MMT. The firm expects Russia to export 64.7 MMT of grain in 2023-24.
This morning, USDA announced daily sales of 200,000 MT of corn for delivery to Mexico and 183,000 MT of soybean cake and meal for delivery to the Philippines, both during the 2023-24 marketing year.
CORN: December corn futures saw buying on the open but have since faced profit taking. Bulls continue to struggle with $4.99 resistance, though losses have remained limited off the level. Initial resistance stands at $4.96, then $4.99-$5.00. Support lies at $4.89 1/2, with firmer backing at $4.85.
SOYBEANS: November soybean futures surged on the overnight open but have since sold to near unchanged. Prices continue to base between 20-day moving average resistance at $12.89 3/4 and 10-day moving average support at $12.78 1/4. These will continue to remain important pivots, as the former capped early session gains. Firmer support stands at $12.72, while stiff resistance lies at the psychological $13.00 level.
WHEAT: December SRW futures traded at the highest level since Sept. 27 overnight and continue to affirm that a near-term downtrend is broken on the daily bar chart. Buying stalled at 40-day moving average resistance overnight, currently at $5.93 1/2, which has not been tested since early August. Support stands at $5.78 1/2, $5.76 3/4, then $5.59.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Lower.
CATTLE: Live cattle futures are expected to open mostly higher as last week’s cash trade proved higher than expected, giving traders hopes of firmer cash prices again this week. Packers bought a lot of cattle last week, which could depress their willingness to raise bids this week, though the higher volume of cash trade the past couple of weeks could limit producer inventory of market-ready cattle, keeping prices high. This week’s cash trade could be pushed deep into the week as packers and feedlots may wait until after Friday’s Cattle on Feed Report to get serious about negotiations. Wholesale beef prices continue to base near $300.00 and $275.00 for Choice and Select, respectively. Choice cutout fell 39 cents on Friday to $300.80, while Select rose 47 cents to $275.49.
HOGS: Lean hog futures are expected to open mostly lower as technicals are likely to continue to drive selling pressure, though steep discounts to the CME lean hog index could limit selling pressure. The index ended its two-day uptick, falling 31 cents to $82.11 (as of Oct. 12). Nearby December futures remain $12.61 below the index, pricing in a steep decline over the next two months. Wholesale pork prices fell $1.64 Friday with declines in all of the individual components except for ribs, which saw minimal gains.