Ahead of the Open | March 16, 2022
GRAIN CALLS
Corn: 3 to 8 cents lower.
Soybeans: 9 to 14 cents higher.
Wheat: 20 to 30 cents lower in HRW and SRW; 7 to 16 cents lower in spring wheat.
Ukrainian officials gave upbeat assessments of their peace talks with Russia. Ukrainian President Volodymyr Zelenskyy said peace talks were sounding more realistic, but more time was needed, as Russian air strikes killed five people in the capital Kyiv and the refugee tally from Moscow’s invasion reached 3 million.
The area sown with Ukraine's 2022 spring grain crops could fall 39% to 4.7 million hectares due to Russia’s military invasion, the APK-Inform agriculture consultancy said yesterday. The country, which harvested a record 86 MMT of grain in 2021, sowed 7.7 million hectares of spring grains last year. “After the invasion of Russian troops into the territory of Ukraine and as a result of ongoing and further active hostilities in many key regions, there is no physical opportunity to start sowing,” APK-Inform said.
After the conclusion of its Federal Open Market Committee (FOMC) meeting this afternoon, the Federal Reserve is expected to raise its benchmark rate for the first time since 2018 to subdue inflation that is running at the fastest pace in four decades. The Fed funds rate target range is expected to be increased 0.25%, to 0.25% to 0.5%. Particular attention will focus on the number of rate hikes Fed officials expect will be needed in 2022 and beyond. The Fed may also have something to say about how it intends to trim its balance sheet, which is at $8.9 trillion.
Iran tendered to buy 60,000 MT each of corn, soymeal and feed barley.
CORN: May corn futures overnight traded inside yesterday’s high at $7.59 and $7.36, roughly the middle of the range for the past week. Corn likely will continue to look to the wheat market for direction, with speculative money flow also an influencer. Key support is seen at last week’s low of $7.28 3/4.
SOYBEANS: May soybean futures firmed 14 cents overnight after dropping 11 3/4 cents yesterday to $16.58 3/4, the lowest close since $16.36 3/4 on Feb. 28. Yesterday’s NOPA report showed January soy crush at 165.1 million bu. last month, down 9.4% from January but up 6.4% from February 2021. The numbers imply the full February U.S. crush at 175.0 million bushels.
For the first six months of the marketing year, we estimate U.S. crush at 1.119 billion bu., up from 1.113 bullion bu. for the same period last year. Board crush margins currently are extremely strong throughout the 2021-22 crop year, which would incentivize much greater crush results through summer.
WHEAT: May SRW wheat traded in a relatively narrow range overnight compared to recent weeks after rising 58 cents yesterday to $11.54 1/4. May HRW wheat rose 57 1/2 cents yesterday to $11.57 1/2. Traders will continue to closely monitor the Russia/Ukraine conflict.
LIVESTOCK CALLS
CATTLE: Steady-firmer
HOGS: Steady-mixed
CATTLE: Live cattle futures may see followthough from two days of gains amid optimism cash prices will end a two-week slide. While packers haven’t established bids yet, feedlots are asking $3 to $4 more for cash cattle and general expectations are cash prices will eventually rise $1 to $2 from last week’s average price of $138.30. Choice cutout values rose $2.39 yesterday to $257.90, the highest daily average since Feb. 25. Movement totaled 135 loads. April live cattle rose 52.5 cents yesterday to $140.85, the contract’s highest closing price since $141.425 on Feb. 28. April feeders edged up 20 cents to $162.60.
