GRAIN CALLS
Corn: 1 to 3 cents lower
Soybeans: 7 to 10 cents lower
Wheat: 1 to 3 cents lower
GENERAL COMMENTS: Soybeans were set to open lower after giving up ground overnight in apparent profit taking after strong gains scored earlier this week, with wheat and corn also pulling back. China has bought at least two cargoes of U.S. soybeans, its first known purchase this marketing year, according to a report from Bloomberg. Reuters overnight reported three U.S. soybean cargoes were purchased by China, citing two trade sources. State-owned COFCO bought about 180,000 metric tons of U.S. soybeans for December and January shipment through Pacific Northwest ports, according to the Reuters report. The reported purchases may mark a revival of more U.S. soybean sales to China as part of a wider trade settlement expected to be agreed between the world’s two biggest economies this week. Anticipation of China purchases helped propel strong gains for soybeans, with January hitting a 12-month high on Tuesday.
The Federal Reserve is expected to cut interest rates when it concludes a two-day policy meeting Wednesday afternoon. Fed-funds futures traders have priced in a quarter-point cut and another quarter-point reduction in December, while economists have speculated that the central bank may also move to wind down efforts to shrink its balance sheet in response to recent volatility in the interbank lending market. Traders will pay close attention to the central bank’s so-called dot-plot forecast that maps out individual policymaker expectations for the path of rates, while also keying in on remarks from Chair Jerome Powell.
CORN: December corn faces resistance at $4.37 ¼, with a further upside objective at $4.50. Support is seen at this week’s low of $4.26 and then at $4.20.
SOYBEANS: January soybeans are expected to see support at $10.83 and then this week’s low at $10.70 ¼. Resistance stands at Tuesday’s high of $11.08 and $11.20.
WHEAT: December SRW wheat is expected to see support at this week’s low of 5.16 ¾ and then $5.10, with bears targeting the $5 level. Resistance is seen at $5.35 and then $5.40.
LIVESTOCK CALLS
CATTLE: Choppy/lower
HOGS: Choppy/lower
CATTLE: Cattle futures are expected to open weaker. Bulls have been attempting to stabilize the market amid recent volatility, while feeder cattle continue to suffer. A bounce could occur as long liquidation and margin-related selling lets up. USDA at midday Tuesday reported active trade at $229.79 versus last week’s average of $237.89, a sign producers were spooked by the recent drop in futures. Wholesale beef was mixed Tuesday, with Choice-grade up 80 cents to $378.68, while Select fell 30 cents to $361.36.
HOGS: Lean hog futures are expected to open weaker. Bears continue to have the technical advantage with prices in a steep downtrend. Support persists at the 200-day moving average at $80.83 in the December contract, with next support at the psychologically important $80 level. Resistance is seen at this week’s high of $82.575 and then at last week’s high of $84.05. The latest CME lean hog index was down 68 cents at $92.27 on Tuesday. Today’s projected cash hog index is down another 24 cents at $92.03. Tuesday’s national direct 5-day rolling average cash hog price quote was $88.16.