Ahead of the Open | September 28, 2022
GRAIN CALLS
Corn: 1 to 3 cents higher.
Soybeans: 1 to 3 cents lower.
Wheat: 13 to 15 cents higher.
GENERAL COMMENTS: Wheat futures extended Tuesday’s corrective rebound overnight amid concerns over supply disruption in the Black Sea region. Corn climbed to modest gains after falling earlier to a three-week low. Soybeans finished overnight trade slightly lower. Malaysian palm oil futures tumbled 8.5% on concerns over demand, while front-month crude oil is up over $1. U.S. stock index futures signal a firmer open and the U.S. dollar index is up slightly after earlier posting a fresh 20-year high.
Hurricane Ian will make landfall in west-central Florida to the south southwest of North Point and west southwest of Punta Gorda. Peak winds off the coast will reach 155 miles per hour (mph), while coastal wind speeds will reach 120 mph with a significant storm surge getting to the range of 8 to 12 feet above normal tides in some areas. Serious damage to citrus production is likely from Sarasota to southwestern Polk Counties in Florida with lighter damage to the northeast and south, World Weather Inc. said.
Russian-installed officials in four occupied regions of Ukraine reported huge majorities of votes in favor of joining Russia following referendum votes that ended Tuesday. The U.S. planned a United Nations resolution condemning the referendums as shams and was also preparing a new round of sanctions against Russia should it annex Ukrainian territory and a $1.1 billion arms package for Ukraine that will be announced soon, U.S. officials said.
The U.S. and its allies are causing a global food crisis by draining the market, Russian President Vladimir Putin said. “Predatory” monetary and trade policies pursued by the U.S. and its allies are the primary cause of the global food crisis, Putin said. Western nations are using their wealth and ability to print money to vacuum up food products from the global market, the Russian leader said during a government meeting. Putin also reiterated his criticism of the Ukraine grain deal, which allowed Kiev to export food via the Black Sea.
Ukraine’s grain exports are down 42% year-over-year so far in 2022-23 at almost 8 MMT, but the pace of shipments is increasing gradually, agriculture ministry data showed. The country’s grain exports slumped since Russia invaded in February because its Black Sea ports were closed off. Ministry data showed exports so far included 4.49 MMT of corn, 2.78 MMT of wheat and 669,000 MT of barley.
Argentina’s ag ministry says farmers sold 1.6 MMT of soybeans between Sept. 15-21, a 30.4% decrease compared to the previous week. The slowdown in sales happened after the country’s central bank decided to prevent the purchase of foreign currency for companies using the preferential exchange rate.
Sunflower oil’s premium over soyoil has narrowed and the oil has started gaining lost market share on rising supplies from top exporter Ukraine after the UN-brokered corridor through the Black Sea came into force from August. Sunflower oil prices have dropped by nearly half from their record high hit in April.
Indonesia plans to set its crude palm oil reference price at $792.19 per metric ton for Oct. 1-15, economic ministry official told Reuters, down from $846.32 per metric ton for Sept. 16-30. That would place the export tax for palm oil at $33 per metric ton.
The Philippines tendered to buy up to 50,000 MT each of feed wheat and feed barley.
CORN: December corn futures dropped under trendline support around $6.65 and fell as low as $6.61 1/2 earlier in overnight trading, the contract’s lowest intraday price since Sept. 9, before rebounding. Initial support comes in at the 40-day moving average and the September low, both around $6.54.
WHEAT: December SRW wheat reached $8.89 1/4 overnight after gaining 13 1/2 cents Tuesday but remained within the previous day’s range. Initial support comes in at the 20-day moving average around $8.56 1/4.
LIVESTOCK CALLS
CATTLE: Steady-weaker
HOGS: Steady-weaker
HOGS: Lean hog futures may extend Tuesday’s nosedive to nine-month lows on pressure from eroding cash fundamentals and technical-based selling. October futures’ discount to the CME lean hog index has sharply widened again with hefty losses the past week. The cash index is down another 58 cents to $96.41, its fifth drop in the last six days. October hogs finished Tuesday $7.71 below today’s cash quote. Pork cutout values fell $2.45 Tuesday to $99.01, the lowest daily average since May 12. Movement was strong at 375 loads. December hogs fell $3.15 Tuesday to $76.25, the lowest close since December 2021.
China’s sow herd totaled 43.2 million head at the end of August, according to local media, citing ag ministry data. That was a 0.6% increase from July.
