Ahead of the Open | January 3, 2022
GRAIN CALLS
Corn: 3 to 6 cents higher.
Soybeans: 18 to 22 cents higher.
Wheat: 3 to 7 cents higher.
GENERAL COMMENTS: Soybean futures were surged around 20 cents after limited rains reached dry areas of South America over the weekend. Corn and wheat futures also rose. Malaysian palm oil future rallied nearly 4.0% amid expectations for tight production. Nymex crude was down around 50 cents. U.S. stock index futures are up slightly and the U.S. dollar index is slightly weaker this morning.
Periodic rains will offer some relief in southern Brazil over the next 10 days, while rainfall will remain frequent in northeastern areas, World Weather said. Conditions will remain favorable in far western and central Argentina, though any rains in northeastern areas won’t be enough to counter the expected hot temperatures.
Patches of winterkill may have occurred in U.S. hard red winter wheat areas over the weekend after bitterly cold temperatures gripped the region, which has limited snow cover, World Weather said. “Damage cannot be ruled out from southwestern Nebraska, Colorado, extreme northwestern Kansas or some of the more seriously drought impacted areas in the Texas Panhandle, but the odds of widespread crop loss are very low,” the forecaster said.
The U.S. soybean crush in November likely totaled 5.753 million short tons, or 191.7 million bu., according to the analyst estimate in a Reuters survey ahead of USDA’s monthly oilseed crushing report today. The expected crush would be down from 196.9 million bu. processed in October, the all-time high for a single month.
China's biggest soybean grower, the northeastern province of Heilongjiang, plans to increase the area planted to the crop by 666,667 hectares in 2022, Xinhua news agency reported. China’s soybean output dropped sharply last year as farmers grew more corn.
CORN: Corn is currently a weather market, meaning day-to-day price action will likely depend heavily on the South American outlook, though it’s a follower relative to soybeans in that regard. March corn futures rallied as high as $6.03 1/2 overnight.
SOYBEANS: March soybeans rose as high as $13.64 3/4 overnight after settling at $13.39 1/4 last Friday.
WHEAT: March SRW futures wheat rose as high as $7.82 1/4 overnight after settling at $7.70 3/4 last Friday. March HRW futures reached $8.17 overnight. March spring wheat reached as high as $9.94.
LIVESTOCK CALLS
CATTLE: Steady-firm
HOGS: Steady-mixed
CATTLE: Live cattle futures may gain support if strength in the cash and wholesale beef markets last week carries forward this week. Live steers averaged nearly $140.00, up from the previous week’s average of $135.64, while Choice cutout values ended the week at $265.26, up $2.32 from the end of last week. Beef movement also improved last week, indicating retailers started post-holiday restocking. February live cattle futures ended last week at $139.70, up 7.5 cents for the week and up $1.80 for the month. A push above last week’s high at $141.425 may have bulls targeting the contract high of $141.85 posted Nov. 29. March feeder cattle ended last week at $169.95, the contract’s highest closing price since Sept. 1.
HOGS: Lean hog futures may face followthrough technical pressure from a late slump last week, but declines may be limited if packers, back on a full slaughter schedule, step up demand and boost cash prices. If the cash market doesn’t show strength early this week, futures may extend last week’s corrective pullback. February lean hogs ended last week at $81.475, down $1.75 for the week. Pork carcass cutout values ended last week at $91.35, down 12 cents from a week earlier but up $7.37 from the end of November.
