Ahead of the Open | November 17, 2023
GRAIN CALLS
Corn: 2 to 4 cents lower.
Soybeans: 5 to 8 cents lower.
Wheat: 2 to 6 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat faced price pressure overnight. Corn was unable to build on Thursday’s late rally, while the other two markets faced followthorugh selling. Fresh news is lacking today, so technical action will likely dominate trade ahead of the weekend. Crude oil futures are around $1.00 higher and the U.S. dollar index is about 200 points lower, though that positive outside market influence failed to spur buying in grains overnight.
Brazil’s center-west and center-south crop areas will experience slowly increasing shower and thunderstorm activity during the weekend and into next week. World Weather Inc. says the precipitation will decrease again late next week, but it will not be as hot and dry as it has been. Rainfall will remain lighter than usual into early December, despite the fact that showers will continue to pop up occasionally during that period. Rains are expected to continue in southern Brazil, but World Weather says they aren’t likely to be as heavy as they have been.
Argentina’s weather is expected to remain mostly favorable, though there are pockets of dryness in northwestern areas.
French farmers had sown 71% of the expected soft wheat area for next year’s harvest as of Nov. 13, compared with 96% by the same time last year. The country’s ag ministry reported 86% of the soft wheat crop was in good or excellent condition compared to 98% at this point in 2022. Crop institute Arvalis said above-average precipitation in most parts of France over the past month had delayed field work and that farmers may need to reseed some flooded areas.
CORN: December corn futures continue to consolidate above Monday’s low. Near-term support extends from $4.67 3/4 to Monday’s low at $4.61. Near-term resistance is in the $4.76 to $4.82 1/2 range.
SOYBEANS: January soybean futures are showing signs of a short-term top. Near-term support is the 100-day moving average at $13.46 1/2 and the 20-day average at $13.41. Tough resistance is at Wednesday’s high at $13.98 1/2.
WHEAT: December SRW futures remain in the sideways-to-lower pattern. Near-term support extends from Thursday’s low at $5.47 to the contract low at $5.40. Near-term resistance is layered from $5.54 1/2 to the $5.71 area.
CATTLE: Lower.
HOGS: Mixed.
CATTLE: Live cattle futures are expected to open under pressure on followthrough selling after sharp losses and a low-range close on Thursday. But price action could turn choppy if early seller interest is limited as traders await USDA’s Cattle on Feed Report this afternoon. Traders expect the report to show the Nov. 1 feedlot inventory up 1.8%, with October placements anticipated to be up 4.6% and marketings down 2.1% from year-ago levels. The sharp drop in cattle futures yesterday triggered cash cattle sales at $2.00 to $3.00 lower prices in the Southern Plains. Wholesale beef prices dropped $1.61 for Choice and 20 cents for Select on Thursday. While the wholesale market is struggling to find a price bottom, movement has been strong this week, signaling improved retailer demand.
HOGS: Lean hog futures are expected to open with a mixed tone. While the high-range close yesterday could trigger some followthrough, buyer interest is likely to be limited by weakness in the cash hog market. The CME lean hog index is down 38 cents to $75.68 (as of Nov. 15), marking a new low this fall. December lean hog futures firmed 42.5 cents on Thursday, cutting the discount in the lead contract to $4.205. The pork cutout value fell 90 cents yesterday.
