GRAIN CALLS
Corn: 5 to 7 cents lower.
Soybeans: 10 to 13 cents lower.
Wheat: Winter wheat, 10 to 12 cents lower; HRS, 7 to 10 cents lower.
GENERAL COMMENTS: A lack of concrete details on additional purchases of agricultural goods by China during President Donald Trump’s summit meeting with Chinese leader Xi Jinping sparked a selloff Thursday that was extended in overnight trade. Technical selling amid overbought conditions also contributed to the initial drop. Barring a turnaround in Friday’s session, corn, wheat and soybeans are headed for technically bearish weekly low closes. Key outside markets see the U.S. dollar and Treasury yields higher, while Nymex WTI oil futures were up more than $3 a barrel to trade just below $100.
On Friday, U.S. Trade Representative Jamieson Greer said he anticipates that China will commit to billions in American agricultural purchases, as Presidents Trump and Xi Jinping just completed their summit in Beijing. “We expect to also see an agreement for double-digit billion purchases of ags over the next three years, per year, coming out of this visit, and that’s more general, that’s aggregate, that’s not just soybeans, that’s everything else,” Greer told Bloomberg Television in an interview on Friday. Greer accompanied Trump on the trip, the first by an American president to China in nearly a decade and a crucial opportunity to help ease trade tensions between the world’s two largest economies. U.S. Treasury Secretary Scott Bessent said Thursday on CNBC that one idea is for each country to cut tariffs on about $30 billion worth of trade “for non-critical areas and areas that we’re not trying to reshore.”
The final estimate from the Wheat Quality Council’s annual crop tour put the average yield for Kansas at 38.9 bushels per acre after 394 field stops, according to Bloomberg. That’s well below last year’s forecast of 53 bushels per acre, with a survey of the tour’s participants pegged Kansas wheat production at 218 million bushels, the second-lowest going back to 1972. That’s a drop on a scale that affirms the 25% drop in winter wheat production forecast by USDA in its Tuesday Crop Production Report. “It’s a nightmare out there,” Vance Ehmke, who grows wheat for seed, told Bloomberg. “You don’t know whether you’re coming or going with this weather.”
CORN: July corn futures extended losses overnight. A price uptrend is still in place on the daily bar chart but it is now in serious jeopardy, with important support seen at last week’s low of $4.61. The next upside price objective for the bulls is to close July prices above solid chart resistance at the March and April high of $4.87 1/2.
SOYBEANS: July soybeans were extending overnight losses, trading below Thursday’s ahead of the break.
A price uptrend in place on the daily soybean bar chart is also now in serious jeopardy. Initial support at $11.80 was tested overnight, with the next layer of support seen at $11.80 and then at $11.70. The next downside price objective for the bears is closing prices below solid technical support at the April low of $11.56 3/4. On a rebound, initial resistance is seen at $12.00 and then at $12.10.
WHEAT: Wheat futures were lower across all classes, dragged down by weakness in corn and soybeans. July SRW wheat traded below initial support at $6.50, with the next layer of support seen at $6.36, a target for the bears. On a bounce, resistance is seen at $6.75 and then this week’s high at $6.88 ¼.
LIVESTOCK CALLS
CATTLE: Lower.
HOGS: Lower.
CATTLE: Live cattle futures are expected to open on the downside after a corrective pullback in Thursday’s session. Solidly higher cash cattle prices fetched in active trading late this week limited selling interest in futures on Thursday. USDA at midday Thursday reported active cash trading activity, with steers fetching an average price of $262.30 and heifers $261.78. Last week’s average cash cattle trade was $258.52. Hot temperatures in the southern Plains through this weekend will stress livestock.
HOGS: Lean hogs are expected to open lower after seeing a downside correction Thursday. The near-term technical posture for June hogs is still bearish as prices are still in a downtrend on the daily bar chart. The latest CME lean hog index is up 26 cents at $90.74. Today’s projected cash index price is down 26 cents at $90.48. The national direct five-day rolling average cash hog price quote Thursday was $95.04.