GRAIN CALLS
Corn: 2 to 8 cents lower.
Soybeans: Steady to 4 cents lower.
Wheat: 3 cents lower to 8 cents higher.
GENERAL COMMENTS:
Corn and soybean futures are expected to open mostly lower with favorable growing weather seen persisting across most of the Midwest through the middle of July. Spring wheat futures are firmer on dry conditions in the Northern Plains, while HRW and SRW markets are burdened by ongoing harvest and weakness in corn. In other markets, the U.S. dollar index stock index is slightly weaker while Nymex crude oil futures are up over 1%.
Last night’s GFS model run continued to show significant rainfall prospects in much of the Corn Belt today into July 18, World Weather Inc. said in a report. “The Corn Belt will likely be in a wet pattern until the last 10 days of July and this will mostly support good crop development, though pockets of the region will receive too much rain, leading to flooding and fieldwork delays.”
USDA Secretary Tom Vilsack is traveling to Omaha, Nebraska/Council Bluffs, Iowa, for what USDA has billed an “important” announcement, which some speculate may involve the government making $500 million available starting in fiscal 2022 to expand meat processing capacity.
French farmers have harvest just 1% of their soft wheat crop and 15% of the durum crop amid delays from cool, wet weather, according to the French farm office. Last year at this time, 10% of the soft wheat crop and 33% of the durum crop were harvested.
In demand news, USDA today reported an export sale of 228,600 metric tons of soybeans for delivery to Mexico during the 2021-22 marketing year. Also, Algeria purchased around 30,000 metric tons (MT) of milling wheat of South American, European or Australian origin. Iran’s state agency bought around 130,000 MT of milling wheat. Pakistan issued an international tender to buy 500,000 MT of wheat.
CORN: USDA’s weekly export sales report today showed net corn sales of 173,200 MT for the week ended July 1 for 2020-21, up 58 percent from the prior four-week average. For 2021-22, net sales totaled 198,000 MT. Trade expectations ranged from minus 100,000 to 350,000 MT for 2020-21 and 100,000 to 600,000 MT for 2021-22. December futures overnight fell as low as $5.15 1/2 a bushel, the lowest intraday price since June 24, and prior to today’s open was down over 10% from last week’s close of $5.79 3/4.
SOYBEANS: USDA reported net weekly soybeans sales of 63,800 MT for 2020-21, down 19 percent from the prior four-week average, and net sales of 118,500 MT for 2021-22. Expectations ranged from minus 100,000 to 275,000 MT for 2020-21 and 200,000 to 500,000 MT for 2021-22. November soybeans fell as low as $13.15 1/4 overnight and are down from last week’s close of $13.99.
WHEAT: USDA reported net wheat sales of 290,800 metric tons MT for the week ended July 1, which included increases from the Philippines (120,000 MT), Mexico (85,500 MT), South Korea (82,500 MT) and China (69,500 MT). The sales were within trade expectations for 200,000 to 450,000 MT.
CATTLE: Steady-weaker
HOGS: Steady-mixed
CATTLE: Futures face pressure from weaker cash cattle and an ongoing slump in wholesale beef prices, which fell near three-month lows. Live steers in five top U.S. feedlot areas yesterday averaged $121.06, down from $126 the previous day and down from an average of $123.89 last week. Choice cutout values averaged $281.97, down 3% from last week’s average of $290.63 and the lowest since April 21. Packers have been moving a solid amount of beef, but the persistent decline in wholesale values suggests they are having to discount prices to attract retailer demand. Beef demand, especially for the higher-value cuts, typically slows after the July 4 holiday, which weakens the cutout. USDA’s reported net weekly beef sales of 23,700 MT, up 96% from the previous week and up 64% from the prior four-week average.
HOGS: Lean hog futures face technical weakness but firmer pork values may help the market find support. Carcasses on national direct markets yesterday averaged $109.82, down $1.09 from the previous day but up from $108.21 at the end of last week, according to USDA. Pork cutout values averaged $116.89, up $1.15 from the previous day. Movement totaled about 300 loads. The CME lean hog index is projected at $109.77, down 36 cents from yesterday and $12.91 below the mid-June peak. July hogs closed Thursday at a 33-cent premium to the cash index, but August hogs are still trading at a $9-plus discount, suggesting traders sense the cash decline will extend. USDA reported net weekly pork sales of 43,800 MT, up 53% from the previous week and up 65% from the prior four-week average.