GRAIN CALLS
Corn: 2 to 4 cents higher.
Soybeans: 4 to 6 cents higher.
Wheat: Winter wheat 4 to 7 cents higher; HRS steady to 2 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat each favored the upside in overnight trade. Corn continues to be rangebound and needs to finish the week strong. Outside markets are supportive this morning as front-month crude oil futures are solidly higher and trading above $60.00 while the U.S. dollar index is modestly lower.
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Last-minute legislative deal-making left language out of U.S. government funding bills that would have allowed year-round use of E15—a gasoline blend containing 15% ethanol. Instead, lawmakers established a study group to advance separate legislation in February. “Corn growers are disgusted, disappointed and disillusioned that after spending years of calling for passage of E15, Congress has again punted, and it has done so in a spectacularly weak and offensive way,” said National Corn Growers Association President Jed Bower, in a statement. Rep. Zach Nunn, an Iowa Republican, and other Midwestern lawmakers had threatened to block the funding package without a deal to approve year-round sale of E15, Politico reported.
European Union lawmakers are expected to vote on ratifying the bloc’s trade deal with the U.S. after President Trump on Wednesday walked back his latest threat to impose tariffs on European countries. The trade deal’s ratification process was suspended after Trump indicated he wanted to acquire Greenland. However, after Trump announced a framework deal with NATO on Greenland and said the U.S. was cancelling new tariffs on EU countries, European Parliament President Roberta Metsola said that reversal was enough to justify voting on the measure, which could have a preliminary vote in the coming days. “This means we can continue with our discussions internally with the EU-U.S. trade deal, which had been paused,” Metsola said Thursday before an emergency meeting of EU leaders.
The deal between President Trump and NATO Secretary General Mark Rutte paves the way for NATO to beef up security in the Arctic region and fend off any threat from Russia or China, Bloomberg reported. The framework entails the stationing of U.S. missiles, mining rights aimed at keeping Chinese interests out, and a bolstered NATO presence, according to a European official briefed on the talks. The issue of sovereignty was not on the table, with Danish Prime Minister Mette Frederiksen emphasizing that ceding territory to the U.S. is non-negotiable and that any agreement must respect international law and sovereignty, said the Bloomberg report.
CORN: March corn futures continue to trade in a tight range. Resistance stands at $4.26 1/2 on a push higher while bulls are looking to hold support at $4.22.
SOYBEANS: March soybeans have consolidated from early week gains. Bulls are looking to hold support at $10.62 1/4 while resistance comes in at $10.73 on persistent strength.
WHEAT: March SRW futures are again challenging key resistance at $5.20, the 40-day moving average. That level has capped each rally so far this year. Support stems from $5.13 3/4 then $5.07. Price action has been tightening on the daily bar chart, indicative of a bigger move to come.
LIVESTOCK CALLS
CATTLE: Choppy/higher.
HOGS: Choppy/higher.
CATTLE: Live cattle futures are expected to open with a mostly firmer tone in a continuation of the long-standing uptrend on the daily bar chart. Fundamentally, the cattle market remains fully bullish. Very light cash trade has taken place so far this week, in part due to today’s cattle on feed report. A Reuters survey of analysts expects the report to show cattle on feed as of Jan. 1 at 96.8% of the level seen one year ago at the same time. Placements in December are seen at 93.5% of a year ago. Marketings in December are expected by analysts to be at 101.5% of one year ago at the same time. Choice beef continues to work higher, rising $1.34 to $367.45 Thursday. Select slid 72 cents to $361.73
HOGS: Lean hogs are expected to open with a mostly firmer tone in a continuation of recent strength. Some additional consolidation is possible given the recent push higher, but persistent strength in cash fundamentals continues to support higher hog prices. The CME lean hog index is up another 67 cents to $83.07 as of Jan. 21. Pork cutout rose 64 cents to $94.62 Thursday, led by strength in butts and bellies.