Ahead of the Open | November 15, 2023
GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: 2 to 5 cents lower.
Wheat: 2 to 4 cents lower.
GENERAL COMMENTS: Corn, soybeans and wheat each traded higher in early morning trade though saw profit taking into the break, sending each product nearer session lows. Outside markets saw mixed action following yesterday’s explosive moves in stocks, bonds and the U.S. dollar index. Equities saw continued upside despite an uptick in the U.S. dollar index, trading around 200 points higher, and treasury yields, which are up to about 4.5% in early trading. Front-month crude oil futures continue to struggle against resistance, continuing yesterday’s slide.
The House passed a stopgap funding bill by a vote of 336-95, with 127 Republicans and 209 Democrats voting to send the bill to the Senate, exceeding a two-thirds threshold required under a special procedure (suspension of the rules) employed by House Speaker Mike Johnson (R-La.) to sidestep internal GOP disagreements. The legislation sets up two funding deadlines: Agriculture, Energy and Water, MilCon-VA and Transportation-HUD – until Jan 19. The rest of the federal government, including the Pentagon, will be funded until Feb. 2. The measure includes an extension of the 2018 Farm Bill through September 2024, and funds 21 “orphan” programs via offsetting funding from biorefinery programs.
President Joe Biden told reporters yesterday he would define success from his meeting with Chinese leader Xi Jinping as getting “back on a normal course of corresponding: being able to pick up the phone and talk to one another when there’s a crisis, being able to make sure our militaries still have contact with one another.” Biden will meet with Xi at 1:00 p.m. CT.
Analysts polled by Reuters expect the National Oilseed Processors Association (NOPA) to report soybean crush at 187.2 million bushels. If realized, that would be up 13.2% from September, 1.5% higher than October 2022 and the largest figure on record for any month. Soyoil stocks are expected to rise to 1.188 billion pounds.
This morning, USDA announced daily sales of 124,000 MT of corn for delivery to Japan during the 2023-24 marketing year, marking the third day in a row of daily corn sales announcements.
CORN: December corn futures saw profit taking from early morning buying efforts, with prices trading near initial support at $4.74 3/4. This is backed by downtrend support at $4.72 3/4. Bulls are looking to overcome 20-day moving average resistance at $4.77 1/2, backed by $4.80.
SOYBEANS: January soybean futures struggled to overcome the $14.00 level overnight and faced profit taking thereafter. Bulls are seeking to hold prices above $13.87 1/2, which marks the downtrend stemming from the July highs. Bulls are seeking to hold support at $13.65 3/4, quickly backed by the 10-day moving average at $13.62 1/2
WHEAT: December SRW futures failed to maintain gains overnight and posted mild losses into the break. Bulls are seeking to hold prices above $5.62 support, which marks uptrend support stemming from the September lows. This is backed by $5.54 1/2 support, while bulls are seeking to overcome initial resistance at the 10-day moving average at $5.74 3/4, backed by $5.81.
CATTLE: Lower.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mostly weaker tone following the last two days of corrective buying. December futures are forming a bear flag on the daily bar chart, with prices potentially breaking down sooner than later as the technical posture remains fully bearish. Cash cattle trade has yet to take place this week. As is typical during weeks with a Cattle on Feed Report, negotiations have been slow to develop. Wholesale beef prices continue to fall below prior “value” levels of $300.00 for Choice and $275.00 for Select as prices slumped $2.18 to $295.67 and $1.36 to $267.88, respectively.
HOGS: Lean hog futures are expected to open mostly higher as cash fundamentals show signs of stabilizing. The CME lean hog index rose 8 cents to $76.13 today (as of Nov. 13) after hitting a for-the-move low the prior day. The index has firmed four of the last six days, pointing to signs of stabilization and giving traders confidence the seasonal low may come earlier than usual, as the spread between the index and December futures is a narrow $3.83. Wholesale pork prices rose 83 cents to $87.60 Wednesday and movement jumped to 303.19 loads.
