GRAIN CALLS
Corn: Steady to 2 cents higher.
Soybeans: 7 to 9 cents lower.
Wheat: 2 to 4 cents lower.
GENERAL COMMENTS: Soybeans led weakness overnight and revisited this week’s lows. That pulled corn and wheat lower as well, but buying interest picked up in each going into the break and corn looks poised to open higher. Outside markets are quiet this morning as front-month crude oil futures are trading near unchanged while the U.S. dollar index is around 10 points higher.
USDA reported daily sales of 132,000 MT of soybeans for delivery to China, 104,328 MT of soymeal for delivery to Mexico and 250,000 MT of corn for delivery to unknown destinations.
Global stock indexes have hit record highs or have them in their sights after a week in which affirmation that the Federal Reserve’s interest-rate easing cycle remains intact helped clear the way for a year-end “Santa Claus” rally. Europe’s Stoxx 600 rose as much as 0.5% to a fresh peak. A measure for Asia advanced to less than 2% from its all-time high. S&P 500 futures were slightly lower after the benchmark posted a new closing milestone late this week. “Everyone is convincing themselves that there will be a Christmas rally, so it looks like there will be one, and to be honest, there’s no negative catalyst visible until the end of the year,” said Karen Georges, a fund manager at Ecofi Investments in Paris and as reported by Bloomberg. “Investors are keen to buy this year’s laggards; it’s a good time to diversify your portfolio at the moment.”
The U.S. dollar index hit a six-week low Thursday and is set to post a decline for the third consecutive week. The depreciating greenback comes as the Federal Reserve cut interest rates as expected and delivered a less hawkish outlook than markets anticipated. Fed Chair Jerome Powell indicated that further rate hikes are unlikely, with Fed projections pointing to a single reduction next year. In contrast, other major economies, including Australia, Canada, and Europe, are seeing hawkish repricing, further weighing on the greenback. The U.S. dollar is poised to weaken against most major currencies this week, with the steepest losses expected versus the Euro currency.
Fertilizer stocks jumped after Ukraine said drones had hit two fertilizer plants in western Russia, on concerns that geopolitical tensions will affect supply chains for key crop nutrients, Bloomberg reported. Drones hit Acron and Dorogobuzh facilities, which produce nitric acid, ammonia and other materials used to manufacture explosives, Ukraine’s Commander of the Unmanned Forces Robert Brovdi said on Facebook. While the affected plants are relatively small in context of overall fertilizer capacity, “the market priced in expectations for peace which they’re now reversing,” Bloomberg Intelligence analyst Alexis Maxwell said. Trade flows of the key crop inputs have been disrupted since Russia invaded Ukraine in 2022, sending U.S. prices for nitrogen fertilizers to a record high that year.
CORN: March corn continues to chop sideways. Support stands at $4.44, which has limited the downside most of this week. Resistance comes in at this week’s high of $4.49 on strength.
SOYBEANS: January soybeans led weakness overnight. Support comes in at this week’s low of $10.81 1/2 then $10.79 3/4. Resistance stands at $10.93 1/2 then $11.00 on resurgent strength.
WHEAT: March SRW futures gave up most of Thursday’s gain overnight. Support persists at $5.30 while additional selling eyes support at $5.25 1/4. Resistance comes in at $5.35, the 10-day moving average, on a bounce.
LIVESTOCK CALLS
CATTLE: Higher.
HOGS: Higher.
CATTLE: Cattle futures are expected to open higher in a continuation of recent strength. Bulls remain in full control after extending prices higher out of the sideways consolidation pattern that capped gains early in the week. Cash cattle trade has picked up, averaging $226.31 so far this week, a sharp gain over last week, which continues to support higher futures. Wholesale beef meanwhile continues to fall under pressure as choice slid $1.25 to $358.11 while select sunk $1.42 to $343.46.
HOGS: Lean hog futures are expected to open higher in a continuation of recent strength. Bulls broke prices higher on Thursday, surging to the highest mark in six weeks. That bullish momentum is likely to spur additional strength today. The CME lean hog index continues to show signs a low could be in place, as the index is up another 41 cents to $82.57 as of Dec. 10. Pork cutout rose $1.57 to $98.84 Thursday, led by gains in butts and bellies, though all cuts saw gains on the day.