GRAIN CALLS
Corn: 2 to 4 cents higher.
Soybeans: 6 to 8 cents higher.
Wheat: Winter wheat 1 to 3 cents higher; HRS 3 to 5 cents higher.
GENERAL COMMENTS: Corn and soybeans recouped a portion of Tuesday’s losses overnight, while wheat saw continued strength. Volume was once again quite limited overnight. Front-month crude oil futures are currently higher, bouncing from yesterday’s 16-month low. The U.S. dollar index is modestly higher and trading near recent highs.
The annual inflation rate in the U.S, measured by the consumer price index (CPI), fell for the fifth consecutive month to 2.5% in August, the lowest since Feb. 2021. That is down from 2.9% in July and in line with expectations. Monthly CPI rose 0.2%, in line with a month ago and expectations. Core CPI rose 0.3% month over month, above expectations of 0.2%, but year-over-year Core CPI rose 3.2%, in line with expectations. Traders are betting the Fed will cut rates by 25 basis points next week, rather than the potential 50 basis points that was favored last week.
Hurricane Francine continues to gain strength in the Gulf of Mexico slightly east of the Texas/Mexico border. The system will move northeast and likely make landfall in the south-central Louisiana coast this evening. The system will then move up through the Delta later Wednesday through Thursday as it gradually weakens over land before dissipating on Friday. World Weather Inc. says, “Overall, the damage from Hurricane Francine will be greatest near the Louisiana coast and the impact on agriculture should be relatively low. Some damage to sugarcane is quite likely, but cotton, sorghum, soybeans and other crops to the north will have a much lower impact.” Double-crop soybeans and other late-maturing crops outside of the Louisiana coastline could benefit from remnant rains.
The first and perhaps only presidential debate between Vice President Kamala Harris and former President Donald Trump in Philadelphia saw Harris set an assertive tone from the start, crossing the stage to shake Trump’s hand and introduce herself before the debate began. This power move seemed to catch Trump off guard and set the stage for Harris to control much of the conversation throughout the night. Harris employed her prosecutorial background, pressing Trump on various issues and fact-checking his statements in real-time. She frequently pivoted from attacking Trump to addressing voters directly about their concerns. Trump attempted to portray Harris as an out-of-touch liberal, while Harris sought to paint Trump as self-absorbed and lacking the temperament for the presidency.
A group of nearly 40 Iowa Republican lawmakers plans to sue both federal and state courts, claiming the Iowa Utilities Commission acted illegally and unconstitutionally in approving the $8 billion Summit Carbon Solutions pipeline. The project, which would connect 57 ethanol plants across several states, has faced opposition due to concerns over safety, property rights and eminent domain. The lawmakers, calling themselves the Republican Legislative Intervenors for Justice, are also exploring legislative actions to halt the pipeline and reform regulatory processes.
CORN: December corn futures saw modest strength overnight. Resistance comes in at $4.07 1/2, the 40-day moving average, then $4.12 3/4. Support lies at $4.04 1/4, which is reinforced by the psychological $4.00 mark.
SOYBEANS: November soybean futures posted modest gains overnight. Initial resistance stems from $10.10, which is reinforced by the 40-day moving average at $10.18 3/4. Support comes in at the psychological $10.00 mark then $9.91 1/2.
WHEAT: December SRW futures continued to see relative strength overnight. Gains stopped just shy of the Sept. 4 high of $5.82 3/4, which marks initial resistance. Additional buying finds resistance at $5.98. Support stands at $5.67 then Monday’s low at $5.60 1/2.
LIVESTOCK CALLS
CATTLE: Lower.
HOGS: Choppy.
CATTLE: Live cattle futures and feeders are expected to open lower as cash fundamentals continue to wane. While feeders saw relative strength yesterday, October futures struggled against downtrend resistance, which is likely to pressure the market today. Last week’s cash cattle average showed a year-over-year drop, the first time the cash market traded below the corresponding week from the previous year since spring 2021. Wholesale pork ended Tuesday lower as Choice cutout dropped 29 cents to $308.23 and Select sunk $1.48 to $297.01.
HOGS: Lean hog futures are expected to face modest volatility as oversold conditions are met with continued weakness in the cash market. The CME lean hog index is down another 18 cents to $85.56 as of Sept. 9. The discount that futures hold to the index has swooned to $7.01 over the past week, which could lead to profit-taking, especially if relative strength returns to the index, which is possible given strong pork demand. Pork cutout fell another 92 cents to $94.80, led lower by hams. While prices fell, movement jumped to 434.32 loads, indicating robust demand.