Ahead of the Open | September 3, 2021
GRAIN CALLS
Corn: 2 to 7 cents lower.
Soybeans: 7 to 11 cents higher.
Wheat: 3 cents lower to 4 cents higher.
GENERAL COMMENTS: Corn futures fell overnight amid ongoing concerns that damage from Hurricane Ida will disrupt U.S. Gulf grain exports. Soybean futures rose overnight, while wheat futures were mostly higher. Nymex crude oil rose slightly and the U.S. dollar index fell to the lowest in a month.
Grain and livestock markets will observe normal hours today ahead of the holiday weekend. Markets and government offices will be closed on Monday for Labor Day. Grain and soybean futures markets will reopen at 7 p.m. CT on Monday. Livestock will resume trading at 8:30 a.m. CT on Tuesday.
USDA reported a daily sale of 130,000 metric tons (MT) of soybeans for delivery to China during the 2021-22 marketing year.
U.S. jobs growth slowed significantly during August, as the Labor Department reported non-farm payrolls rose 235,000, far below expectations for a gain of 720,000. The unemployment rate fell to 5.2% from 5.4%. Disappointing job gains came amid impacts from the Delta variant of Covid.
A “large, strong trough of low pressure” may dip into the western U.S. Sep. 10-15 with an associated “unusually cool air mass” and rain in the Northern Plains, World Weather Inc. said, citing the GFS model.
StoneX raised its U.S. corn yield projection by 0.6 bu. from last month to 177.5 bu. per acre and hiked its U.S. corn production estimate from 14.945 billion bu. to 14.998 billion bushels. The brokerage also added 0.8 bu. to its U.S. soybean yield forecast, now at 50.8 bu. per acre, and boosted estimated production from 4.332 billion bu. to 4.409 billion bushels.
Much of Argentina’s main farm belt received rain this week, easing concern about dry weather clipping the country’s wheat crop. The Buenos Aires Grain Exchange expects a 2021-22 wheat crop of 19 million metric tons (MMT).
Russia hiked its weekly tax on wheat exports to $46.50 per metric ton for Sept. 8-14, up $6.90 from the previous week. The combination or rising tariffs and rising wheat prices for wheat have curbed export demand for Russian wheat.
Ukraine’s grain exports are off to a strong start. Two months into the 2021-22 marketing year, Ukraine has exported 9.14 MMT of grain, a 1.1-MMT (13.7%) increase from last year at this point, according to ag ministry data.
USDA raised its projected U.S. farm income to the highest level since 2013. Net cash farm income, which tracks producers’ cash flow, will hit an estimated $134.7 billion in 2021, up $6.4 billion from a February forecast. The projected income would be an increase of almost 22% from 2020's $110.9 billion.
CORN: December corn fell as low as $5.20 overnight and was on track to close with a sharp loss on the week, after ending last week at $5.53 3/4. Chart levels to watch include yesterday’s low at $5.16 3/4 and the 200-day moving average around $5.03.
SOYBEANS: November soybeans overnight rose as high as $12.93 3/4 but is poised to close lower on the week, after ending last week at $13.23 1/4. Chart levels to watch include Wednesday’s low of $12.70, a two-month low, and the 200-day moving average around $12.57.
WHEAT: December SRW futures overnight rose as high as $7.22 3/4 but is still down for the week, after ending last week at $7.32 1/2. Chart levels to watch include yesterday’s low at $7.05 1/2, the lowest intraday price in nearly five weeks, and the 100-day moving average around $7.01.
LIVESTOCK CALLS
CATTLE: Steady-weak.
HOGS: Steady-mixed.
CATTLE: October live cattle are on track to post a sharp loss on the week behind a slumping wholesale beef market and weaker chart patterns. Choice cutout values fell 53 cents yesterday to $337.92, the lowest in over two weeks. Cash markets for slaughter-ready cattle have traded around steady this week, with prices yesterday ranging from $123 to $126. Meatpackers slaughtered an estimated 476,000 head of cattle the first four days this week, up 2.8% from the same period a week earlier and up 0.2% from the same period a year earlier, USDA reported. October live cattle yesterday dropped $1.525 to $126.05, the contract’s lowest settlement since $125.25 on July 21. The lead month ended last week at $129.125.
HOGS: Futures are poised to end slightly lower on the week on pressure from weakening cash fundamentals and expectations for seasonally increasing supplies. Pork carcass cutout values rose $2.73 to $109.27 yesterday after dropping the day before to the lowest price since late March. Primal ham prices surged nearly $11. The latest CME Lean Hog index fell 94 cents to $102.67, the lowest since April. Meatpackers slaughtered an estimated 1.907 million head of hogs so far this week, up 2.5% from the same period last week and up 0.4% for the comparable period a year ago, USDA reported. October lean hogs yesterday fell 30 cents to $89.85, down from $90.725 at the end of last week.
