Ahead of the Open | March 11, 2024
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GRAIN CALLS
Corn: 2 to 4 cents lower.
Soybeans: 5 to 7 cents lower.
Wheat: SRW 3 to 5 cents lower; HRW 7 to 10 cents lower; HRS 3 to 5 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat each drifted lower on low volume in overnight trade, giving up a portion of Friday’s gains. Front-month crude oil futures saw modest losses, following significant selling pressure on Friday. The U.S. dollar index is saw modest gains, though marked a fresh two-month low in early trading.
China continues to cancel sales of SRW wheat, as USDA reported additional cancellations of 264,000 MT for 2023-24 delivery this morning, bringing the total to 504,000 MT in the last three business days.
Statistics Canada reported total seeding intentions of 27.0 million acres of wheat, above expectations of 26.7 million acres and in-line with last year’s plantings. The agency reported canola seedings intentions of 21.4 million acres, just below expectations of 21.6 million acres and below 22.0 million acres in 2023. StatsCan also reported Durum planting intentions of 6.3 million acres (6.0 million acres last year), oat intentions of 3.1 million acres (2.5 million acres last year) and barley intentions of 7.1 million acres (7.3 million acres last year).
Forecasts for Brazil’s center-west and interior south are drier than on Friday over the next 10 days. World Weather Inc. says crop moisture stress will rise in Mato Grosso do Sul, southern Mato Grosso, northwestern Parana and western Sao Paulo. Argentina is expected to be excessively wet this week in east-central areas due to three waves of significant rain.
Brazil’s soybean harvest reached 55% done as of last Thursday, according to AgRural. While that remained head of the last year’s 53% on this date, the pace has slowed due to rainy weather in areas with mature soybeans left to harvest. Safrihna corn planting stood at 93% complete, ahead of 82% on this date last year.
Poland’s prime minister pledged to reduce a grain surplus on the domestic market at talks with farmers on Saturday, but union leaders said they were pressing on with weeks of protests. “The premier told the farmers there will be money available to take several million tons of grain off the market,” said Deputy Agriculture Minister Michal Kolodziejczak. But Tomasz Obszanski, leader of the NSZZ RI Solidarnosc union for individual farmers, said after the meeting the protests would continue and would be stronger. “In reality we left the meeting with nothing,” he said.
CORN: May corn futures posted losses overnight. Resistance stands at $4.38, backed by Friday’s high of $4.39 3/4, then the 40-day moving average at $4.43. Bulls are seeking to hold support at $4.33 3/4, the 20-day moving average, a break below which could indicate a failed breakout. Further selling eyes support at $4.30 then $4.24 3/4.
SOYBEANS: May soybean futures gave up a portion of Friday’s gains overnight. Resistance stands at $11.83 1/2 with backing from the 40-day moving average at $11.95 1/4. Bulls are seeking to hold support at $11.69 1/4, the 20-day moving average, loss of which would indicate a false breakout on the daily bar chart, a bearish omen. Further selling targets support at $11.48 1/4.
WHEAT: May SRW futures saw renewed selling overnight. Bulls are eyeing resistance at $5.42 3/4 with backing from the 10-day moving average at $5.49 1/2. Support comes in at $5.28 1/2 then the contract low of $5.26. Additional selling pressure sees support at $5.19 3/4.
CATTLE: Choppy/higher.
HOGS: Lower.
CATTLE: Live cattle futures and feeders are expected to open with a mostly firmer tone on technical buying. April futures continue to trade largely sideways, though support stemming from the December lows has caught up to prices, which could be the support the futures market needs to resume the uptrend. Last week’s cash cattle average is likely to jump from the prior week, with the average through Thursday at $185.15, compared to the prior week’s average of $183.30, which should bolster futures as well. Wholesale beef prices have been firming consistently, as Choice cutout rose 43 cents to $307.04 and Select firmed $1.17 to $297.43 on Friday. That’s the highest quote for Choice beef since late October of last year and the highest mark for Select since June 2023. Beef packer margins have improved amid the rising wholesale prices, but remain in the red.
HOGS: Lean hog futures are expected to open lower as bears are likely vindicated about stalling gains in the cash market. The CME lean hog index is unchanged at $81.48 today (as of Mar. 7), hinting at a potential stall of the seasonal rally that began at the beginning of this year. Traders have been actively removing premiums from April futures over the past couple of weeks in anticipation of stalling gains in the cash market. The premium April futures hold to the index has dropped to $2.895 when compared to today’s cash quote. Bulls are hoping to “buy the news,” marking recent selling pressure as overdone, which could limit losses after the open, though April futures are likely to closely track price action in the index in the coming days. Wholesale pork prices firmed 96 cents to $92.11 on Friday, posting gains in all cuts except loins.
