Ahead of the Open | November 30, 2022
GRAIN CALLS
Corn: 1 to 2 cents higher.
Soybeans: 11 to 14 cents higher.
Wheat: HRW and SRW wheat 2 to 6 cents higher, spring wheat narrowly mixed.
GENERAL COMMENTS: Soybean futures rose to the highest levels in over two months overnight and corn and winter wheat also firmed. Malaysian palm oil futures rose 0.5% and posted a 4.5% gain for the month on strong export demand, while front-month crude oil surged more than $2. U.S. stock index futures signal a firmer open and the U.S. dollar index is down around 200 points.
USDA reported a daily sale of 136,000 MT of soybeans for delivery to China during the 2022-23 marketing year. Today’s announcement follows a Nov. 23 sale of 110,000 MT of soybeans to China.
Traders continue to closely follow protests over Covid lockdowns in China. China’s ruling Communist Party has vowed to “resolutely crack down on infiltration and sabotage activities by hostile forces” following the largest street demonstrations in decades staged by citizens angered by strict Covid restrictions. While it did not directly address the protests, the statement serves as a reminder of the party’s determination to enforce its rule.
Argentina’s weather remains concerning amid persistent dryness, World Weather Inc. said, with soil moisture levels particularly poor for areas including Santa Fe, southeastern Santiago del Estero, Chaco and western Entre Rios. Brazil’s weather is expected to remain “favorably mixed” over the next 10 days, with some improved soil moisture likely over time in Mato Grosso and neighboring areas that have been dry, the forecaster said.
Around 450,000 MT of Ukrainian grain is being transported via Poland monthly, over 50% more than in the middle of the year, Poland’s infrastructure minister said on Wednesday. “Compared to October last year, the increase in grain transport in the same period of 2022 is over 16 times,” he added.
The House votes today on legislation to avert a rail strike. House Speaker Nancy Pelosi (D-Calif.) announced plans for a separate vote on whether to add seven days of sick leave to the contract. The decision comes after a growing chorus of Democrats voiced opposition to Congress passing a railroad deal they viewed as unfriendly to rail workers.
Malaysia maintained its December export tax for crude palm oil at 8% and raised its reference price, the Malaysian Palm Oil Board website showed on Wednesday. The country calculated a reference price of 3,847.24 ringgit ($866.50) per metric ton for December, up from 3,575.80 ringgit in November.
Exports of Malaysian palm oil products for November rose 5.6% to 1.58 MMT from 1.50 MMT shipped during October, cargo surveyor Intertek Testing Services said on Wednesday.
China will auction another 40,000 MT of wheat from state reserves on Dec. 7.
South Korea purchased 69,000 MT of corn expected to be sourced from South America.
CORN: March corn futures traded within the previous session’s tight range overnight, holding between support at the 10-day moving average of $6.67 3/4 and resistance at the 20-day moving average around $6.70 3/4.
WHEAT: The U.S. winter wheat crop’s condition continued to improve modestly. USDA late Tuesday reported 34% of the U.S. winter wheat crop was in either “good” or “excellent” condition as of last Sunday, up from 32% a week earlier and about one percentage point above analysts’ expectations.
When USDA’s final weekly crop condition ratings of the fall are plugged into the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop jumped 11.3 points to 280.3, though that was still 51.9 points below the five-year average for the end of November. The SRW crop improved 2.8 points to 360.2, which was still 14.5 points below average.
LIVESTOCK CALLS
CATTLE: Steady-firm
HOGS: Steady-weak
HOGS: Lean hog futures likely will remain under pressure from weak cash and bearish technicals, though the market may be due for some corrective buying following sharp declines over the past week. The CME lean hog index is down 42 cents to $84.21, the lowest since early February. Wholesale pork extended a recent slump as packers slash prices to encourage retailer buying. Pork cutout values fell $3.84 Tuesday to $85.68, the lowest since Jan. 12, as all cuts with the exception of primal rib dropped. Movement was strong at 331 loads. February lean hogs fell 60 cents Tuesday to $84.15, the contract’s lowest close since Oct. 14.
