GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: 2 to 4 cents lower.
Wheat: Winter wheat 5 to 7 cents lower; HRS 3 to 5 cents lower.
GENERAL COMMENTS: Wheat led overnight weakness with corn and soy pausing recent strength as well. Buying increased in all three into the break. Commodity markets as a whole dipped lower overnight after robust strength early in the week. Front-month crude oil futures are posting modest losses while the U.S. dollar index continues to march higher.
USDA reported daily sales of 259,000 MT of soybeans for delivery to unknown destinations, 130,000 MT of soybeans for delivery to China and 100,000 MT of corn for delivery to unknown destinations—all for delivery in the 2024-25 marketing year. Today marks the sixth consecutive day of daily sales of corn.
Russian President Vladimir Putin declared the expansion of the BRICS group (Brazil, China, Egypt, Ethiopia, India, Iran, Russia, Saudi Arabia, South Africa and the United Arab Emirates) signifies the creation of a “multipolar world,” challenging the U.S.-led global order. As we alerted last week, Russian President Vladimir Putin officially proposed the creation of a BRICS grain exchange, which could later be transformed to other commodities, including energies. Putin told the leaders of BRICS countries at a summit in Russia such an exchange would help protect trade between the bloc as well as other countries in the Global South from external interference and excessive price volatility. Putin also advocated for BRICS nations to reduce reliance on the U.S. dollar by increasing trade in national currencies. While some BRICS members support this shift, others like India, South Africa and the UAE are cautious about any anti-U.S. perception.
Brazilian Agriculture Minister Carlos Favaro has advocated for the country to join China’s Belt and Road Initiative (BRI) as a strategy to counteract protectionist measures from the U.S. and European Union, Bloomberg reports. This proposal to participate in China’s major global trade and infrastructure program has divided opinions within President Luiz Inacio Lula da Silva’s administration. Some ministers see it as essential for securing substantial new investments, while others worry it might strain Brazil’s existing relationships with the U.S. and EU.
An increase in Russian attacks on Ukrainian port infrastructure in recent weeks threatens food shipments to needy destinations from Gaza to southern Africa, the UK warned. British intelligence detected a “noticeable increase in Russian risk appetite,” leading to at least four merchant ships being damaged during attacks on Black Sea ports between Oct. 5 and Oct. 14, UK Prime Minister Keir Starmer’s office said. The UK, which alongside Norway is leading efforts to protect a maritime corridor in the Black Sea, described the affected shipments as “collateral damage” in Russian President Vladimir Putin’s campaign against Ukraine. On Tuesday, Ukrainian Infrastructure Minister Oleksiy Kuleba said the government will strengthen defense measures in every Black Sea port.
CORN: December corn futures paused recent strength overnight. Yesterday’s strength flipped the 40-day moving average to initial support at $4.12 3/4, which is backed by $4.09 1/2. Continued strength finds resistance at $4.19 1/4.
SOYBEANS: November soybean futures saw selling pressure overnight. Continued selling finds support at $9.80 then the for-the-move low at $9.68 1/4. The 10-day moving average stands as firm resistance at $9.93 1/2, which is reinforced by the psychological $10.00 mark.
WHEAT: December SRW futures reversed lower overnight. Support comes in at yesterday’s low of $5.65 3/4, which is quickly reinforced by downtrend support at $5.64. Resurgent buying interest finds resistance at $5.76 then the 40-day moving average at $5.81.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Higher.
CATTLE: Live cattle futures and feeders are expected to open mostly higher in a continuation of Tuesday’s technical strength. Cash fundamentals continue to support higher futures prices, though long-term downtrend resistance, stemming from the May, July and October highs, could limit buying interest after the open. Traders are also likely to keep premiums to the cash market at a minimum considering the rise in cash cattle prices is getting long in the tooth when compared to the rallies seen over the course of the past year. Choice cutout is up another $1.10 to $323.96 while Select slipped $1.41 to $294.80.
HOGS: Lean hog futures are expected to open higher in a continuation of Tuesday’s technical breakout. December futures surged to six-month highs as contra-seasonal strength continues to underpin prices. The CME lean hog index is up another 11 cents to $84.34 as of Oct. 21, the third consecutive daily gain. December futures closed just $5.215 below today’s cash index quote, indicating traders anticipate a smaller-than-average seasonal decline over the course of the next two months. Pork cutout slipped 97 cents to $97.27 on Tuesday, led lower by losses in loins and picnics, though movement was strong at 308.96 loads.