GRAIN CALLS
Corn: 1 cent lower to 1 cent higher.
Soybeans: Steady to 2 cents lower.
Wheat: Steady to 2 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat each have favored a sideways tone much of this week ahead of key USDA reports due out Friday. Corn continues to trend higher despite the lack of followthrough strength recently. Outside markets are mixed this morning as front-month crude oil futures are modestly higher while the U.S. dollar index is around 100 points higher.
U.S. producer prices, as measure by Producer Price Inflation (PPI) reported by the Bureau of Labor Statistics, unexpectedly fell 0.1% month-over-month in August, following a downwardly revised 0.7% rise in July and well below expectations of a 0.3% gain. It is the first decline in producer prices in four months with costs for machinery and vehicle wholesaling leading PPI lower. On the year, PPI rose 2.6%, below 3.1% in July and forecasts of 3.3%. PPI showing an unexpected drop is encouraging given the anticipation of increased inflation due to tariffs and further bolsters the Federal Reserve’s ability to cut rates in next weeks meeting.
Poland shot down Russian drones that crossed into its territory during Russia’s latest massive air strike on Ukraine. Poland called it an “act of aggression.” Polish Prime Minister Donald Tusk said the airspace violation in the early hours of Wednesday amounted to an intentional provocation from Moscow, forcing the NATO and European Union member state to close its airspace and order citizens in the eastern part of the country to stay indoors. Poland will seek to trigger North Atlantic Treaty Organization consultations on a potential response, a procedure known as Article 4, the premier said. Polish authorities registered 19 airspace violations, with a “significant” number of drones originating from Belarusian territory, Tusk said.
U.S. Treasury Secretary Scott Bessent called on the Federal Reserve to change its monetary policy stance after a government agency revised U.S. jobs data to show weaker hiring in the year through March. “They should, let’s see if they will,” Bessent said on Fox Business Tuesday, and as reported by Bloomberg, when asked if the Fed should recalibrate. He cited famed economist John Maynard Keynes for saying “when the facts change, I change my mind — what do you do?” Bessent’s comments came after the revised jobs data on Tuesday morning showed there were 911,000 fewer payroll gains in the 12 months through March. “It turns out that we didn’t have good facts.” In a posting on X Tuesday, the Treasury chief said, “President Trump inherited a far worse economy than reported, and he’s right to say the Fed is choking off growth with high rates.”
CORN: December corn continue to chop sideways. Support stems from the 10-day moving average at $4.17 1/4 on a push lower, while key resistance stands at the psychological $4.25 mark.
SOYBEANS: November soybeans continue to trade mostly sideways. Bulls are seeking to hold prices above support at $10.21 1/2 on a push lower while resistance stands at yesterday’s high of $10.36 on a bounce.
WHEAT: December SRW wheat saw modest gains overnight. Bulls are eyeing resistance at $5.23 1/2 on persistent strength. Support comes in at $5.19 1/4 then $5.14 1/2 on a reversal lower.
LIVESTOCK CALLS
CATTLE: Lower.
HOGS: Choppy/lower.
CATTLE: Cattle futures are expected to open lower in a continuation of yesterday’s selling pressure. Cattle limits are expanded today following yesterday’s limit lower close in feeders. While futures have quickly turned bearish, the cash cattle market remains strong, though trade has yet to initiate this week. That is partially due to packers likely lowering bids amid futures’ weakness. Wholesale beef was mixed Tuesday as Choice cutout slid $2.02 to $407.67 while Select rose $1.62 to $386.96.
HOGS: Lean hog futures are expected to open with a mostly weaker tone amid technical selling pressure. October futures are butting up against key technical resistance and a weaker cattle market will make it difficult for continued strength in hogs. The CME lean hog index is down another 4 cents to $105.87 as of Sept. 8. Pork cutout slid $2.22 to $114.16 on Tuesday, led by losses in bellies and loins.