GRAIN CALLS
Corn: Steady to 2 cents higher
Soybeans: 8 to 12 cents higher
Wheat: 5 to 8 cents higher
GENERAL COMMENTS:
Rains continued to fall in the far eastern Corn Belt, areas where moisture has been ample to excessive. An active weather pattern is expected across the Corn Belt through early next week, with the dry northwestern Corn Belt expected to receive some significant rain and severe thunderstorms. “However, more rain will still be needed in eastern South Dakota and Minnesota,” World Weather adds. Warmer weather is likely to heighten crop stress in the driest areas of the northwestern Corn Belt and Northern Plains during the last 10 days of this month, World Weather says.
China’s summer wheat crop climbed 2% from 2020 levels to 134 MMT on a rise in both planted acreage and yields, the country’s National Statistics Bureau said. However, heavy rains leading up to and during harvest in Shandong, Henan, Hebei and Hubei, major producing provinces, caused some quality damage.
Note: Today is the last trading day for July grain and soy futures. After yesterday’s intra-day short squeeze in July corn, the contract finished well off its highs. More fireworks ahead of today’s expiration can’t be ruled out, but the fact futures fell so far from their intra-day high yesterday suggests the squeeze play is likely over.
CORN: Futures posted two-sided trade overnight but firmed late, suggesting a higher open this morning. To attract sustained buyer interest, December corn likely needs to push above yesterday’s high at $5.47, which it failed to do overnight. The broad July 6 chart gap starts at $5.52 1/4.
SOYBEANS: Futures ended on or near session highs overnight, signaling bulls will maintain the upper hand on the reopening this morning. Meal and soyoil futures were also firmer overnight. November soybeans must push above Tuesday’s high at $13.65 1/2 to attract fresh chart-based buying. The overnight high was $13.62 3/4.
WHEAT: Gains in the winter wheat markets mildly outpaced spring wheat futures overnight. That’s a healthy sign given the price driver in the wheat complex is the spring wheat crop concerns. Yesterday’s contract high in September HRS futures was $8.70 3/4, while the contract reached a high of $8.68 overnight.
CATTLE: Choppy to higher
HOGS: Higher
CATTLE: Live cattle futures are expected to see followthrough buying from Tuesday’s gains, despite finishing off session highs. Initial cash cattle trade this week has been at steady to slightly firmer prices, which given the discount August futures hold to last week’s average cash price, is supportive. Meanwhile, wholesale beef prices continue to weaken. Choice boxes dropped $1.66 and Select were $2.03 lower on Tuesday, though movement improved to 176 loads. Packers must find a level where prices can stabilize and they are still able to attract enough retailer demand before the product market will bottom.
HOGS: July hogs are likely to see limited trade ahead of tomorrow’s contract expiration. The contract finished Tuesday $1.58 above where the cash index, which is starting to firm again, will be quoted today (as of Aug. 12). Deferred lean hog futures are likely to see followthrough buying after a high-range close yesterday. Support will come from rising cash and product prices. The average national direct cash hog price firmed $4.56 yesterday, while the pork cutout value strengthened $1.08 on a strong 392.34 loads of movement. Technically, some contracts posted upside breakouts from the recent consolidation range yesterday, while others were close to doing so. That should attract some chart-based buying.