GRAIN CALLS
Corn: 1 to 2 cents higher
Soybeans: 5 to 7 cents higher
Wheat: 5 to 7 cents higher
GENERAL COMMENTS: Wheat, corn and soybeans were higher overnight as investors and traders showed increased risk appetite across markets on signs a record-long U.S. government shutdown is nearing its end. Gold rose more than 2%, while U.S. stock-index futures pointed to solid gains on Wall Street. Oil futures ticked higher, while the U.S. dollar softened versus major rivals.
The main event this week will be the Friday release of the November Crop Production and WASDE reports. USDA announced on Oct. 30 that the reports would come out despite the government shutdown. The market will be eagerly awaiting USDA’s update on yields, exports and other factors.
Evidence of a thaw in U.S.-China trade relations in the week of the Oct. 30 meeting between President Donald Trump and Chinese leader Xi Jinping continues to mount.
–The U.S. and China have suspended port fees on each other’s ships for one year and paused probes into maritime practices, Bloomberg reported. The Trump administration paused a probe into China’s shipbuilding industry, and Beijing shelved its own investigation and put off special port fees on U.S. vessels.
–Reuters reported Friday that China restored import licenses for three firms that had been suspended in March due to escalating trade tensions.
Traders, however, are anxious to see more concrete signs of buying interest in U.S. soybeans beyond a round of initial purchases. The Trump administration has said China has agreed to buy 12 million metric tons of soybeans by January and 25 million metric tons in the following three calendar years.
CORN: December corn see resistance at the Oct. 30 high of $4.37 with support at $4.26 ½.
SOYBEANS: January soybean futures tested psychological resistance at $11.25. Another layer of resistance stands at the Nov. 5 high at $11.37. Support at the 10-day moving average stands at $11.15 ¼.
WHEAT: December SRW sees resistance at the 10-day moving average of $5.36 and then $5.40 on continued strength. Friday’s low at $5.26 ¼ marks support.
LIVESTOCK CALLS
CATTLE: Choppy/higher
HOGS: Choppy/higher
CATTLE: Cattle futures are expected to open with a positive tone after finding short-covering support at the end of last week. Still, live- and feeder-cattle futures have suffered significant technical damage. While tight supplies and strong demand remain in place, futures have retreated since mid-October on calls by President Donald Trump for lower beef prices and fears of policy measures aimed at that goal. Cash prices and wholesale beef trade, however, have seen only modest pressure. Heavy liquidation by speculative interests are suspected to have played a significant role in the selloff so far.
HOGS: Lean hog futures are expected to open with a positive tone after finding modest support from short covering that saw the December contract bounce after hitting a four-month low. Hogs remain in a downtrend, with bulls hoping for a seasonal reprieve as the holidays approach with the potential for consumers to shift away from more expensive beef cuts in favor of hams. The latest CME lean hog index is down another 26 cents to $90.60. Today’s projected cash index price is down another 87 cents to $89.73. The national direct five-day rolling average cash price on Friday was $84.65—down over $3.00 from the prior Friday’s quote.