GRAIN CALLS
Corn: 2 to 4 cents lower.
Soybeans: 2 to 4 cents lower.
Wheat: 6 to 10 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat continue to slide on renewed optimism around a peace deal between the U.S. and Iran. Corn and wheat are leading weakness, with corn hitting a fresh low. Outside markets are mixed this morning as front-month crude oil futures are around $5 lower and near recent lows while the U.S. dollar index is around 135 points lower.
The U.S. is touting progress toward a peace deal with Iran to end the nearly three-month war, despite fresh hostilities and uncertainty over the Strait of Hormuz. One contentious issue under discussion is Iran’s $24 billion in frozen assets, with Tehran wanting half that amount released upon the signing of an agreement. Obstacles to a U.S.-Iran pact include Tehran’s reluctance to allow ships free passage through the Strait of Hormuz and Trump’s desire for Iran to commit to handing over or destroying its stocks of highly enriched uranium. Those are big obstacles.
The weekly USDA crop progress data showed the percentage of the U.S. winter wheat crop rated good to excellent as of Sunday fell a percentage point to 26%, versus analyst expectations for an uptick to 28%. The crop in the Plains has suffered a devastating drought as well as frosts and freezes. On our weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop declined 1.11 points to 240.53. Oklahoma saw the largest decline this week, as most of the state missed out on rains that slightly boosted the crop rating elsewhere in the southern Plains
The rally in U.S. stocks is set to stretch into a fifth day today as optimism around artificial intelligence, lower crude oil prices and easing bond yields spurred traders to grow increasingly bullish. Contracts on the S&P 500 rose 0.3% overnight, while those for the Nasdaq 100 climbed 0.4%, after the relentless advance in chipmakers fueled both gauges to another round of record highs this week. There is trader and investor optimism that the U.S. and Iran are nearing a deal to fully reopen the Strait of Hormuz, which has pressured oil prices.
CORN: July corn futures hit a for-the-move low overnight. Support comes in at the psychological $4.50 mark on continued selling pressure. Resistance stands at $4.60 3/4 on a turn higher.
SOYBEANS: July soybean futures continue to slide. Support stands at the May 15 close at $11.77, which is closely reinforced by the psychological $11.75 mark. Resistance comes in at $11.92 1/2 on a bounce.
WHEAT: July SRW wheat extended lower overnight. Next support lies at $6.20 then $6.12 1/4 on persistent selling. Bulls are eyeing resistance at $6.29 3/4 on a reversal higher.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Cattle futures are expected to open with a mostly firmer tone driven by technical buying. Steep discounts to the cash marker are likely to be supportive of futures as well, though last week’s downtick in the cash market could embolden bears. Last week’s cash average slid $2.36 from the prior week to $260.49 as losses in futures undercut sentiment.
HOGS: Hog futures are expected to open with a mostly firmer tone in a continuation of recent strength. Bulls are looking to build on the last two sessions of gains, negating some of last week’s big selloff. The CME lean hog index is down 18 cents to $90.70 as of May 22, extending the recent slide. Pork production continues to come in above the past few years, weighing on cutout and the cash hog market. Cutout did rise $2.59 to $98.85 Tuesday, led by gains in bellies.