GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: 4 to 8 cents higher.
Wheat: SRW 3 to 5 cents lower; HRW 8 to 10 cents lower; HRS 6 to 8 cents lower.
GENERAL COMMENTS: Soybeans are leading strength amid the ongoing breakout on the daily bar chart. Grains continue to face profit-taking following last week’s push to fresh highs. Front-month crude oil futures surged to fresh highs early in overnight trade but have since fallen back near unchanged. The U.S. dollar index is around 150 points higher this morning.
Latest on the war in the Middle East:
--Iran media says Iran hit U.S. ship with missiles near Strait of Hormuz; U.S. denies report
--U.S. says “Operation Freedom” to help civilian ships leave Gulf region
--Iran juggles oil cuts and storage strain to resist U.S. blockade
--Supertanker appears to have crossed the Strait of Hormuz
--U.S. Is oil supplier of last resort as Hormuz disruptions worsen
--Bessent says U.S. is ‘suffocating’ Iran with oil industry creaking
Crude oil prices jumped more than 5% this morning, with Brent crude reaching a new four-year high, following reports that two missiles struck a U.S. warship after it ignored Iranian warnings. The IRGC Navy also released a new map, designating areas of the Strait of Hormuz under Iranian military control. The U.S. has denied any of its ships have been attacked, according to a social media post by Axios.
China has ordered its companies to ignore U.S. sanctions, “an unprecedented act of defiance that threatens to trap a vast banking sector in the crossfire as tension rises between the world’s largest economies,” Bloomberg said in a report. “Beijing has often railed against unilateral sanctions and pronounced them illegitimate, but it has also quietly allowed its largest companies to comply with them, in order to avoid blowback on its own economy and to preserve access to the U.S. financial system,” said the report. Saturday’s announcement — coming before a long-awaited meeting later this month between President Donald Trump and his counterpart Xi Jinping — signals a far more aggressive stance. “Beijing has now directed companies not to abide by U.S. sanctions on private refiners linked to the Iranian oil trade, including heavyweight Hengli Petrochemical (Dalian) Refinery Co. which was sanctioned last month.”
CORN: July corn futures saw profit-taking overnight. Support stands at $4.75 on persistent selling pressure. Bulls are looking to overcome Friday’s high of $4.83 1/2 on a reversal higher.
SOYBEANS: July soybeans continue to push higher, establishing a bullish breakout on the daily bar chart. Bulls are eyeing resistance at $12.15 1/4 on persistent strength. Support stands at $12.00, bulls line in the sand, on a turn lower.
WHEAT: July SRW futures saw continued profit-taking overnight. Bulls are seeking to hold support at $6.30 3/4 on persistent selling. Resistance comes in at $6.41 3/4, the overnight high, then the psychological $6.50 mark on a reversal higher.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mostly firmer tone amid ongoing cash market strength. Cash cattle likely averaged a record last week, with trade into Friday averaging an impressive $255.02. Futures dipped below the cash market late in the week as traders are likely concerned over poor packer margins, which have worked deep into the red during the recent cash market surge. Choice beef fell 41 cents to $389.11 Friday, further pressuring packer margins.
HOGS: Lean hogs are expected to open with a mostly firmer tone amid technical buying. Friday’s push lower landed prices in the lower end of the recent range, which could spur profit-taking. The CME lean hog index is down 11 cents to $91.30 as of April 30. Meanwhile, pork cutout rose 83 cents to $97.59 Friday, led by gains in loins. Some concern persists over the recent PRV detection at a small commercial swine facility in central Iowa. So far, it is an isolated incident, with no evidence of spreading to other operations and mandatory testing taking place. That news weighed heavily on the market last Friday.