Ahead of the Open | December 16, 2022
GRAIN CALLS
Corn: Steady to 1 cent lower.
Soybeans: Steady to 2 cents higher.
Wheat: 1 to 3 cents lower.
GENERAL COMMENTS: Wheat futures fell slightly overnight, while corn was narrowly mixed and soybean futures were slightly firmer. Malaysian palm oil futures rose 0.6% but still fell 2% for the week on lackluster exports and concerns over Covid cases in China. Front-month crude oil fell more than $2. U.S. stock index futures signal a lower open, while the U.S. dollar index is little changed.
More snow fell on the Northern Plains and upper Midwest Thursday and early today, with total accumulations reaching 28 inches in south-central South Dakota, 26 inches in southeastern North Dakota and 30 inches in northeastern Minnesota, World Weather Inc. said. Bitter cold air is poised to move through the heart of North America next week and into the holiday weekend, likely causing stress to livestock.
Argentina’s latest outlook shows “hints” of improving rainfall prospects, World Weather said. The European model suggests greater rain in Argentina late next week and there is also increasing potential for unsettled weather during the last week of December, “although resulting rainfall will still be lighter than usual while occurring more frequently,” the forecaster said. Southern Brazil “will continue to receive restricted rain and experience net drying conditions over the next 10 days and perhaps longer.”
Indonesia will raise mandatory biodiesel blending to 35% starting Jan. 1, to reduce fuel imports amid high global energy prices and to shift to cleaner energy, the energy ministry said today. Indonesia currently requires 30% of fuel be blended with biodiesel. The estimated demand for biodiesel to support B35 implementation is 13.15 million kiloliters, a 19% increase compared to the 2022 allocation.
Argentina’s planting remains slowed by drought and recent rainfall has been insufficient for rapid fieldwork, the Buenos Aires Grain Exchange said in its weekly report. Soybean planting in the core production area was around 20% behind last year’s pace and overall, farmers had planted 51% of intended acres, the exchange said. Corn planting was 43% done, five points behind last year. The exchange rates Argentina’s soybean crop as 19% good, 61% normal and 20% poor. It rates corn conditions 18% good, 59% normal and 23% poor.
Russia’s wheat export tax for Dec. 21-27 will be 3,333.8 rubles ($51.43) per MT, based on an indicative price of $314.40. That’s up from a rate of 3,143.4 rubles per MT the previous week and the highest rate since early September.
Indian farmers have planted wheat on 28.65 million hectares (70.8 million acres) since Oct. 1, up nearly 3% from a year ago, according to the country’s ag ministry. Rapeseed acreage reached 9 million hectares, up from 8.3 million last year.
CORN: March corn edged above the previous two session highs overnight before stalling at $6.55 3/4, which matched 20-day moving average resistance. The lead contract is up from $6.44 at the end of last week and poised to end a two-week losing streak.
WHEAT: March SRW wheat is trading within the previous session’s range and is poised to post its first weekly gain in six weeks, after ending last week at $7.34 1/4.
LIVESTOCK CALLS
CATTLE: Steady-firm
HOGS: Steady-weaker
HOGS: Lean hog futures may extend Thursday’s plunge to two-month lows as bearish technicals outweigh signs of a seasonal bottom in the cash market. The CME lean hog index is higher for a third straight day, rising 20 cents to $81.88 (as of Dec. 14). After a sharp loss that dropped prices to the lowest level since mid-October, February lean hog futures finished Thursday 23 cents below today’s cash quote. Pork cutout values rose $1.22 Thursday from an 11-month low to $85.49 on strong movement of 321 loads. February lean hogs fell $1.75 to $81.65, the contract’s lowest close since Oct. 11 and down from $84.00 at the end of last week.
