GRAIN CALLS
Corn: 4 to 6 cents higher.
Soybeans: 5 to 7 cents higher.
Wheat: Steady to 3 cents higher.
GENERAL COMMENTS: Corn and soybeans saw strength overnight, led by corrective strength in the old-crop/new-crop calendar spreads. Wheat struggled to maintain early strength and went into the break near unchanged. Outside markets are supportive this morning as front-month crude oil futures are solidly higher and continue to bounce from the double bottom posted on May 5, while the U.S. dollar index is around 250 points lower, giving up a portion of yesterday’s gain.
USDA reported daily sales of 288,000 MT of corn for delivery to Mexico, with 95,100 MT for delivery during 2024-25 and 192,000 MT slated for delivery during 2025-26, and sales of 120,000 MT of soybeans for delivery to Pakistan during the 2025-26 marketing year.
The Trump administration is considering a significant reduction in tariffs on Chinese imports during high-level talks in Geneva this weekend, aiming to ease growing economic pain and reset the tone of U.S./China trade relations, Bloomberg reports. The U.S. delegation, led by Treasury Secretary Scott Bessent, has set a target to reduce current tariffs — some as high as 145% — to below 60%. Multiple officials told Bloomberg that such a move, if mirrored by Beijing, could take effect as soon as next week. Still, officials emphasized that the talks are exploratory and could mark the beginning of a prolonged negotiation process, not a resolution. The U.S. is also pressing for an end to China’s export controls on rare earth elements, critical for manufacturing defense and tech products, and discussions on restricting exports of fentanyl precursor chemicals may follow. White House spokesperson Kush Desai downplayed specific policy targets, stating: “Any discussion about ‘target’ tariff rates is baseless speculation.”
India is analyzing a U.S. request to ease restrictions around the purchase of genetically modified crops as part of ongoing trade negotiations between the two countries, people aware of the matter told Bloomberg. India has offered to slash its tariff gap with the U.S. to less than 4% from nearly 13% now, in exchange for an exemption from President Donald Trump’s “current and potential” tariff hikes, sources with knowledge of the situation told Reuters. This would mean that the average tariff differential between India and the U.S., calculated across all products without weighting for trade volume, would be reduced by nine percentage points. New Delhi has offered to reduce duties to zero on 60% of the tariff lines in the first phase of the deal that is under negotiation, said one Indian government officials familiar with the matter. India also has offered preferential access to nearly 90% of goods imported from the U.S., including the reduced tariffs, another officials said. A team of Indian negotiators is expected to travel to the U.S. later this month to advance the deal.
China imported 6.09 MMT of soybeans in April, up 73.9% from March but down 29.1% from last year and the lowest for the month since 2015, due largely to customs delays in clearing shipments. From January to April, China imported 23.19 MMT of soybeans, a 14.6% decline from the same period last year. Soybean imports are expected to rebound sharply in May and June around 11 MMT. Several crushing plants in northern and northeastern China had to cut output or halt operations due to a lack of supplies.
CORN: July corn futures led overnight strength. Bulls are seeking to tackle resistance at $4.57 on continued strength. Support stems from $4.49 1/4 then yesterday’s for-the-move low of $4.42 1/4.
SOYBEANS: July soybean futures saw continued strength overnight. Resistance stems from the psychological $10.50 mark, which capped gains overnight, then $10.56. Support stands at $10.47 1/4, the 10-day moving average, then $10.43.
WHEAT: July SRW futures struggled to maintain last night’s higher open. Stiff resistance persists at the 10-day moving average at $5.34 3/4 and is reinforced by resistance at $5.40 1/2. Support stands at $5.25 then the contract low of $5.23 1/4.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Mixed.
CATTLE: Live cattle futures and feeders are expected to open with a mostly firmer tone as cash fundamentals continue to support prices but hefty overhead resistance could limit gains after the open. Cash trade has inched higher as the week has gone on and a test of last week’s record now seems likely. Feeders have begun leading strength, with August and September futures closing above the key psychological $300.00 mark yesterday, which could spike profit-taking efforts today. Wholesale beef continues to climb but has done little to offset record cattle prices. Choice cutout was up another $1.74 to $347.89 while Select slid 80 cents to $333.20 Thursday.
HOGS: Lean hog futures are expected to open with a mixed tone as price action continues to tighten on the daily bar chart. Prices remain conflicted by historical strength into the summer months and waning export demand, which has led to choppy action in pork cutout. Wholesale pork fell $1.04 to $94.50 Thursday, led by losses in ribs and bellies, though movement remained firm at 380.73 loads. The CME lean hog index ended its recent long string of gains, down 9 cents to $90.07 as of May 7. The uncertainty over the upcoming action in the index is evident given May futures closed just 57 cents above today’s index quote yesterday.