GRAIN CALLS
Corn: Steady to 2 cents lower.
Soybeans: 8 to 10 cents lower.
Wheat: SRW 3 to 5 cents higher; HRW 2 to 4 cents lower; spring wheat 1 cent lower to 1 cent higher.
GENERAL COMMENTS: Wheat saw relative strength overnight while corn and soybeans gave up some of Monday’s gains. Uncertainty persists around the deal with Iran and what that could mean for fertilizer and oil flows. Crude oil futures were lower overnight, weighing on the complex modestly. The U.S. dollar index is trading near steady this morning.
The White House sought to make the case that its interim deal with Iran will end a global energy crisis and achieve the administration’s wartime goals. World leaders at the G7 meeting in France welcomed the agreement and markets responded positively. However, doubts remained on when it will go into effect — or how exactly it will lead to the reopening of the Strait of Hormuz. The U.S. and Iran have yet to release a text of the memorandum of understanding, and the two sides have diverged on what the agreement will look like, including the potential for tolls on traffic through the strait.
USDA’s Monday afternoon crop conditions update saw corn and soybean conditions with minor improvement over the prior week. The corn crop was rated 68% good to excellent as of Sunday, up from 67% a week ago and in line with the average analyst estimate in a Bloomberg survey. Soybeans were rated 66% good to excellent, USDA said in its weekly report, also up a percentage point from last week and in line with expectations. USDA said 27% of the drought-hit winter wheat crop was rated good to excellent, up 2 percentage points from a week ago and the first improvement in five weeks. Winter wheat harvest was pegged at 25% complete, up from 11% last week and ahead of the 19% expected by analysts. The spring wheat crop was rated 55% good to excellent, up from 52% a week ago and topping the average estimate of 53%. The Pro Farmer Crop Conditions Index, or CCI, which compresses the USDA’s weekly crop progress report into a single, weighted, easy-to-track number that’s widely used to monitor the health and potential of US crops during the growing season, showed a 1.41-point decline to 372 for the U.S. corn crop. The soybean CCI rating declined despite the mild improvement in USDA’s national ratings, dropping 0.98 points to 366.86. The Crop Condition Index showed HRW wheat gaining 5.2 points to 239.85, while SRW increased 0.16 points to 365.28. Read all the state and national CCI ratings here.
CORN: July corn futures saw action on either side of unchanged overnight. Support comes in at $4.11 3/4 on persistent selling. Resistance stands at $4.15 1/2 then $4.21 1/4 on a bounce.
SOYBEANS: July soybean futures gave up most of Monday’s gain overnight. Support comes in at yesterday’s low of $11.02 1/2 on persistent selling. Resistance stands at $11.19 1/4 then $11.25 on a bounce.
WHEAT: July SRW wheat are working higher again today. Bulls are eyeing resistance at $6.00 on continued strength. Support comes in at $5.92 1/2 on a turn lower, which is reinforced by support at $5.84 1/2.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/lower.
CATTLE: Cattle futures are expected to open with a firmer tone in a continuation of Monday’s strength. Bulls closed prices over downtrend resistance stemming from the May highs. Bulls are looking to continue that strength in order to prevent a “false breakout” on the daily bar chart. Last week, cash cattle trade slid 45 cents from the prior week to $256.08. Choice beef surged $3.12 to $395.05 Monday, breaking higher out of the recent sideways range.
HOGS: Hog futures are expected to open with a mostly weaker tone in a continuation of recent selling pressure. Bears defended resistance at $98.05, the 10-day moving average, on Monday, continuing the bearish trend. A weaker cash market continues to undercut futures, as the CME lean hog index is down another 66 cents to $92.09. Pork cutout gave up a portion of Friday’s gains, sliding 27 cents to $97.12 on Monday, led by losses in butts.