GRAIN CALLS
Corn: 12 to 15 cents lower.
Soybeans: 14 to 18 cents lower.
Wheat: 12 to 18 cents lower.
GENERAL COMMENTS: Grain and soybean futures fell overnight as the crude oil dropped to an eight-month low and the U.S. dollar surged to a new 20-year high amid escalating concerns over the global economy. Malaysian palm oil futures fell 2.4% after a leading analyst warned prices would plunge by more than 30% by the end of this year. Front-month crude oil is down nearly $3, falling to just above $80. U.S. stock index futures signal a weaker open and the U.S. dollar index is up more than 800 points.
Polling stations opened in four Russian-controlled parts of Ukraine, with residents given until next Tuesday to vote on whether they want to officially join Russia. Both the Ukrainian government and Western leaders have declared the referendums are illegitimate and an excuse for annexation and they plan to ignore the results. Ukrainian authorities claim the Russians’ own polling suggests that no more than 10% of the population will turn out. Ukraine is urging its citizens not to take part, and for adult men to leave the regions in question to avoid being mobilized against their own country.
Argentina devaluation of its peso earlier this month helped spur soy exports. China booked as much as 3 MMT in the past two weeks, almost as much as the roughly 3.75 MMT it imported from Argentina all of last year, Bloomberg reported, citing people familiar with the matter.
Russia’s wheat export tax for Sept. 28-Oct. 4 will be 2,476.6 rubles ($42.39) per MT based on an indicative price of $308.20. That’s down from a rate of 2,668.3 rubles per MT the previous week and the seventh straight weekly decline. Despite a record crop this year, Russia’s wheat exports have been slower than average, due partly to the restrictive export tax.
China will auction another 500,000 MT of imported soybeans from state-owned reserves on Sept. 30. China has been selling state-owned soybean stockpiles onto the domestic market on a regular basis since March.
India’s palm oil imports could jump 23% in 2022-23 to an eight-year high of 9.5 MMT, as a rebound in consumption and competitive prices prompt refiners to increase purchases, the country’s top palm oil buyer said. Palm oil is offered at $950 per MT including cost, insurance and freight (CIF) to India for October shipment, compared with $1,250 for crude soyoil, according to traders.
Malaysian palm oil prices will plunge to 2,500 ringgit ($547.29) by the end of December, weighed down by improving production, demand destruction and a slowdown in major economies, analyst Dorab Mistry said. Malaysia’s benchmark crude palm oil prices will decline to 3,000 ringgit ($656.74) MT by end-Sept and continue tumbling to its lowest since mid-July 2020 by year-end, Mistry said.
China’s average pork price slipped 0.3% during the week ended Sept. 16 to 30.61 yuan ($4.38) per kilogram, though that was still 77.9% above year-ago. China is selling state-owned frozen pork reserves onto the domestic market to tame prices ahead of the upcoming holiday season.
USDA’s Cold Storage Report Thursday showed beef and pork stocks climbed seasonally during August, though less than average. The smaller-than-normal rise in frozen meat stocks came despite hefty monthly increases in beef and pork production, implying demand was strong and outpaced supplies.
USDA’s Cattle on Feed Report this afternoon is expected to show the Sept. 1 feedlot inventory in line with year-ago levels at 11.2 million head. Placements are expected to be down 2.7% from year-ago, though estimates range from down 6.8 % to up 0.9%. The expected drop in placements would be the sixth year-over-year decline out of eight months this year. August marketings are expected to be up 5.9% from year-ago.
The Philippines purchased 45,000 MT of Australian feed wheat.
CORN: December corn dropped under the 20-day moving average at $6.78 overnight and fell as low as $6.73 3/4, down from $6.77 1/4 at the end of last week. Last week’s low at $6.67 1/2 stands as initial support.
SOYBEANS: November soybeans fell under the 100-day moving average at $14.47 overnight and dropped as low as $14.36 1/4, just under the 20-day moving average at 14.38 1/4. The contract is down from $14.48 1/2 at the end of last week.
WHEAT: December SRW wheat overnight fell as low as $8.90 1/4 and 3/4 cent under Thursday’s low. The contract is still up from $8.59 3/4 at the end of last week.
LIVESTOCK CALLS
CATTLE: Steady-weaker
HOGS: Steady-mixed
CATTLE: Live cattle futures may extend Thursday’s declines as continued weakness in wholesale beef and growing concerns over a potential global recession outweighs a firmer cash market. Sellers reemerged in live cattle futures late this week after the market posted contract highs, indicating traders are cautious despite bullish fundamentals. Choice beef cutout values fell 73 cents Thursday to $248.40, near an 18-month low. USDA-reported live steers averaged $144.90 through Thursday morning, up from last week’s $143.19 average. October live cattle fell $1.025 to $144.85, the contract’s lowest closing price since Sept. 14 and down from $145.50 at the end of last week.
HOGS: Lean hogs face an uncertain outlook amid mixed signals from the cash market. The CME lean hog index is up 5 cents to $98.01 (as of Sept. 21), ending a two-day slide. While the cash index has stabilized after a sharp drop the previous five weeks, October futures finished Thursday $3.885 below today’s cash quote, suggesting traders anticipate price pressure to develop over the next three weeks before the lead contract expires. Pork cutout values rose $3.53 Thursday to $103.88. October lean hogs fell 30 cents Thursday to $94.125, the contract’s lowest close since Sept. 12 and down from $96.90 at the end of last week.