Ahead of the Open | November 24

( )

GRAIN CALLS

Corn: 2 to 4 cents higher.

Soybeans: 2 to 4 cents higher.

Wheat: 2 cents lower to 3 cents higher.

GENERAL COMMENTS: Winter wheat futures climbed overnight to nine-year highs for the third day in a row as excess rain in Australia fueled supply concerns, though SRW futures finished the overnight session slightly lower. Corn hit a three-week high overnight and soybeans also rose. Malaysian palm oil futures rose over 1.0%, the first gain in four sessions. The U.S. dollar index is up around 300 points, reaching a 16-month high for the third straight day.

U.S. markets and government offices are closed tomorrow for Thanksgiving. On Friday, ag markets are open for an abbreviated trading schedule from 8:30 a.m. CT to 12:05 for grains and 12:15 for livestock.

USDA reported daily sales of 330,000 MT of soybeans for delivery to “unknown destinations” and 100,000 MT corn for delivery to Mexico, both during the 2021-22 marketing year.

USDA lowered its U.S. ag export forecast for fiscal year 2022, citing weaker soybean demand from China and lower bean prices. USDA's Economic Research Service said it now expects U.S. ag exports to hit $175.5 billion in fiscal year 2022, down $2.0 billion from its August forecast but still a record. The agency said soybean exports were expected to be down $3.9 billion, to $28.4 billion, while soybean meal exports were forecast to slump $800 million to $4.9 billion due to lower prices.

U.S. ethanol exports are forecast at a record $2.9 billion in fiscal 2022, according to USDA, up $500 million from its August projection. Ethanol is now considered as an agricultural product under the World Trade Organization definition that USDA adopted over the course of 2021.

Deere & Co. reported a 69% rise in fourth-quarter profit today as solid demand for its tractors and combines from farmers cushioned the impact of a worker strike. Net income rose to $1.28 billion, from $757 million a year earlier.

In three separate tenders, South Korea purchased between 256,000 and 271,000 MT of corn, with 68,000 MT expected to be sourced from South America or South Africa and the remainder unspecified origin.

                      

CORN: December corn futures overnight reached $5.84 3/4, the highest intraday price since $5.86 on Nov. 2, after yesterday posting the contract’s highest settlement since $5.89 on July 2. Most-active March futures rose as high as $5.92 3/4 overnight. Focus has shifted to demand with the U.S. harvest largely finished, and the market may also look to the soybean and wheat markets for direction.

SOYBEANS: January soybeans overnight nudged to a high for the week at $12.79 3/4. Growing conditions in South America remain mostly favorable, though a drier pattern is expected to develop in some parts of Brazil over the weekend, according to World Weather Inc.

WHEAT: March SRW and HRW futures overnight reached contact highs for the third straight day, at $8.74 3/4 and $8.92 1/4, respectively. Global supply concerns have intensified this week as excess rains in Australia’s wheat-growing regions raise prospects for lower crop quality.

 

LIVESTOCK CALLS

CATTLE: Steady-firm

HOGS: Steady-mixed

CATTLE: Live cattle futures may climb for a sixth straight session as the cash market extends a rally to 4 1/2-year highs. Cash cattle trade started around $136 in the Southern Plains and $137 in the northern market yesterday, though sales volume was light. With smaller showlists this week, most feedlots passed on initial higher bids in hopes packers would raise bids even more, repeating the pattern from previous weeks. On average, live steers in top feedlot areas traded at $134.00, up from last week’s $133.11 average. Wholesale beef prices appear to have stabilized after a recent drop under $280.00 in Choice cutout values appear to generate greater retail demand. Choice cutout values fell 61 cents yesterday to an average of $278.64, down from last week’s $280.58 average. Slaughter so far this week totaled an estimated 244,000 head, up 1,000 from the same period last week.

February live cattle futures yesterday rose 45 cents to $139.425, the contract’s highest closing price since $139.60 on Aug. 25. Chart levels to watch include the contract high at $140.55 posted Aug. 24.

HOGS: Futures may extend the sideways trade of the past week with weak cash fundamentals countered by ideas the market has established an early seasonal low. December lean hog futures yesterday settled about $1 above where the cash index is quoted today, which likely will limit buyer interest in the front-month contract. National direct carcasses rose 50 cents to $55.41. Pork cutout values fell $1.33 yesterday to an average of $84.92, near a seven-month low of $84.52 reached last week. Movement remained relatively strong at about 325 loads. December lean hog futures fell 50 cents yesterday to $74.15, while most-active February rose 25 cents to $83.275. Chart levels to watch in February hogs include a six-week high at $83.725, posted Nov. 19, and this week’s low at $81.625.

 

Latest News

After the Bell | November 26, 2021

Corn futures settle near five-month high on strong exports, soybeans and wheat lower amid Covid concern.

First Thing Today: Grain, livestock markets expected to face pressure from global risk-off trade after Thanksgiving

Concerns about a new, heavily mutated variant of Covid-19 produced high anxiety among traders overnight, as global stock markets and oil prices plunged, while bonds surged (yields dropped) amid heavy risk-off trade.

Corn, wheat export sales higher than expected

Soybean export sales were within the range of pre-report estimates.

Black Friday: Equities, Oil, Other Markets Plunge on New, Heavily Mutated Variant of Covid-19

More questions than answers on new Covid variant but fear, uncertainty rule markets today

After the Bell | November 24, 2021

Grain, soybean futures end lower in pre-holiday liquidation trade, cattle futures post fresh highs on cash strength.

U.S. Snubs China on Summit Invite | November 24, 2021

General Mills will raise grocery prices, ethanol exports are expected to rise to a record and feedlots pass on higher cash cattle prices...