GRAIN CALLS
Corn: Steady to 2 cents lower.
Soybeans: 6 to 8 cents higher.
Wheat: Steady to 2 cents lower.
GENERAL COMMENTS: Soybeans saw corrective strength off key technical support overnight, while corn and wheat favored the downside. Harvest pressure continues to weigh on corn, as peak harvest across the Corn Belt weighs on prices. Front-month crude oil futures are favoring the downside this morning while the U.S. dollar index is working higher for the third consecutive session.
After a better-than-expected start to planting season, a few weather concerns are starting to emerge in Brazil, said Dr. Michael Cordonnier, Pro Farmer crop consultant. Too much rain in southern Brazil has been accompanied by cooler-than-normal temperatures and localized frosts, he said. The pattern for several months has seen heavy rain in Parana, Rio Grande do Sul and Santa Catarina. The other concern is dryness in parts of central and northeastern Brazil. Southern Brazil has seen a slowdown in soybean planting, while the immediate impact has been on wheat and other small grain production, which will force Brazil to import more high quality wheat from Argentina, he said. Meanwhile, persistent wet conditions in southern Brazil have started to take a toll on the early planted summer crops in Parana.
A wave of low pressure over the Northern Plains/Upper Mississippi Valley will slowly dissipate by Tuesday evening, while producing rain over parts of the Upper Mississippi Valley and Central/Southern Plains on Tuesday morning into early afternoon, the National Weather Service said. A second wave of low pressure over the Northern High Plains will produce rain over parts of the Northern/Central Plains and the Upper/Middle Mississippi Valley on Wednesday morning. Showers and thunderstorms will develop over the Upper Mississippi Valley and Upper Great Lakes on Wednesday evening, the forecast said. By Thursday morning, rain will develop along and ahead of the boundary over parts of the Great Lakes and into the Middle Mississippi Valley.
Sunday’s surprise re-election victory by President Luis Inacio Lula da Silva in Brazil’s presidential election runoff was a major disappointment for Brazil’s agribusiness leaders who had looked to a win by challenger Flavio Bolsonaro, Bloomberg reported. The report noted that the so-called farm caucus has frequently accused Lula of favoring small farmers at the expense of larger commercial producers. Tensions with Lula also reflect ideological and policy differences over land rights, environmental regulation, taxes and government support for agriculture, including farm credit and crop insurance, the report said. The group had expected Bolsonaro to move quickly to bring down interest rates by shoring up public finances and cutting spending.
CORN: December corn futures are trading near recent lows. Support lies at the psychological $4.50 mark. Bulls are looking to overcome resistance at the 10-day moving average at $4.65 1/4, which has not been tested since Oct. 9.
SOYBEANS: January soybeans bounced from 100-day moving average support overnight. That remains a key technical benchmark at $12.55 1/2, which finds reinforcement from $12.50. Resistance comes in at $12.69 3/4, the 10-day moving average, on persistent strength.
WHEAT: December SRW wheat are trading near recent lows. Tentative support lies at $6.10, which is reinforced by support at $6.00. Resistance comes in at $6.25 then the 10-day moving average at $6.37 3/4.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Choppy/lower.
CATTLE: Live and feeder cattle futures are expected to open higher in a continuation of the ongoing uptrend. Bulls remain in full control of the technical advantage and fundamentals are working in their favor. Cash cattle trade rose another $2.87 to $227.06 last week though trade was light. Prices look poised for another jump this week. Choice beef climbed $3.65 to $369.44 Monday, rebounding from recent losses.
HOGS: Lean hog futures are expected to open with a mostly weaker tone in a continuation of recent selling, but corrective buying could limit selling efforts after the open. The CME lean hog index is down another $1.10 to $70.08 as of Oct. 23, extending the seasonal slide. Pork cutout fell another 29 cents to $73.80 Monday, led by losses in bellies and picnics, though movement was firm at 344.7 loads.