GRAIN CALLS
Corn: 2 to 4 cents lower.
Soybeans: 7 to 9 cents lower.
Wheat: Winter wheat steady to 2 cents lower; HRS 2 to 4 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat each saw modest losses most of the overnight session though selling efforts accelerated in corn and beans following this morning’s posts from President Trump regarding EU tariffs. Outside markets saw an uptick in volatility this morning as well, with stock futures trading sharply lower. Front-month crude oil futures are trading modestly lower while the U.S. dollar index is around 650 points lower.
Markets are reeling this morning following Trump’s proposed 50% tariff on the EU, which would take effect on June 1. Via his social media platform “Truth Social,” Trump announced discussions with the EU are “going nowhere” and he is recommending a straight 50% tariff. He cited many non-tariff trade barriers as justification for the increase of tariffs. This pulled agricultural markets off their overnight highs and sent stocks sharply lower as well, quickly brining volatility back into the marketplace ahead of the long weekend.
After the House narrowly passed President Donald Trump’s sweeping tax and spending bill, Senate Republicans quickly signaled they intend to rewrite major sections. Key Senate Republicans raised concerns about provisions including Medicaid cuts, a broader state and local tax (SALT) deduction, and steep rollbacks of clean energy credits. Some senators want deeper deficit reductions, while others warned against moves that could harm rural hospitals and reduce health coverage. While the House bill poses a significant threat to the Inflation Reduction Act’s climate provisions, analysts expect Senate revisions to soften the blow.
Russia has removed a minimum wheat price recommendation for its grain export traders until the end of 2024-25 on July 1, four market sources told Reuters. The minimum price recommendation for May and June had been $250 dollars a metric ton. Russia exported 38.6 MMT of wheat from July 2024 through April, according to estimates from the Rusagrotrans rail carrier, which forecasts total exports for the current season at 42.2 MMT. The removal of the minimum price implies that grain traders can sell the estimated 3.6 MMT of wheat at a price below the recommendation. But Russian wheat exports may not jump as much as some think on this news due to a lack of supplies and limited global demand.
CORN: July corn futures found selling pressure at the 40-day moving average, which will remain key resistance at $4.64 3/4. Strength above that mark would target resistance at $4.69 3/4. Support comes in at $4.58 1/2 then the 10-day moving average at $4.55 1/2 on continued weakness.
SOYBEANS: July soybean futures saw sharp selling this morning. Support stems from the overnight low of $10.56 1/4 then the 40-day moving average at $10.50. Bulls are seeking to reclaim resistance at $10.65 1/4, the 200-day moving average, on a bounce.
WHEAT: July SRW futures continue to consolidate near downtrend resistance. Support stems from the 40-day moving average at $5.43 1/2 then $5.37 on continued selling pressure. Resistance comes in at $5.49 1/4 then this week’s high of $5.56 1/4.
LIVESTOCK CALLS
CATTLE: Lower.
HOGS: Lower.
CATTLE: Live cattle and feeders are expected to open lower following reports President Donald Trump is recommending a straight 50% tariff on goods from the European Union starting on June 1. Cash cattle trade picked up mid-week at higher prices, but risk-off trade in the general marketplace will be difficult to shake, leading to likely lower trade. The EU is a big purchaser of U.S. agricultural goods and trade talks appear to be going the wrong direction. Still, big discounts to the cash market could limit losses after the open. Wholesale beef continues to work higher as well, as Choice cutout is up another $1.38 to $360.97, while Select rose another 67 cents to $348.95 Thursday. USDA’s Cattle on Feed Report this afternoon is expected to show the May 1 feedlot inventory down 1.5%, placements down 3.2% and marketings down 3.3%. USDA’s Cold Storage Report is also out this afternoon. The five-year average is a 16.5-million-lb. decline in beef stocks during April.
HOGS: Lean hog futures are expected to open lower amid risk-off selling in the overall marketplace due to newly promised tariffs on the EU. Cash fundamentals continue to be supportive, which could limit losses after the open, but the EU is a big purchaser of U.S. ag goods and new tariffs will likely lead to retaliation. The CME lean hog index is up another 41 cents to $92.75 as of May 21. Premiums futures hold to the cash market continue to shrink. Pork cutout was up 23 cents to $100.27 Thursday, led by strength in picnics and bellies, though movement remains light. USDA’s Cold Storage Report is also out this afternoon. The five-year average is a 21.7-million-lb. increase in pork stocks during April.