GRAIN CALLS
Corn: 2 to 5 cents higher
Soybeans: 3 cents lower to unchanged
Wheat: 8 to 12 cents higher
GENERAL COMMENTS: Corn and soybean futures opened overnight trade firmly higher along with the spike in oil futures but have fallen slightly from those highs since. Wheat also opened higher and has added to those gains, a positive sign given the weak technical closes in both SRW and HRW last Friday. Front-month crude oil futures peaked at $105.63 a barrel overnight and are at $103.62 as of 7:45 A.M. CST this morning.
Australia set up a government working group with the fertilizer industry to safeguard urea supplies at risk from disruptions linked to the war in Iran, Agriculture Minister Julie Collins said, according to Bloomberg. The country has sufficient urea supplies in reserve and “on the water,” Collins said, adding the government is working with industry to secure longer-term availability. Grocery prices may immediately rise 3% to 4% as higher fuel and fertilizer costs linked to the conflict feed through the economy, Collins said, citing Treasury estimates. About 60% of Australia’s urea — a key nitrogen fertilizer used to boost crop yields — typically passes through the Strait of Hormuz.
Global prices will take time to come down to levels seen before the U.S.-Israeli war with Iran even if a ceasefire holds, International Monetary Fund Managing Director Kristalina Georgieva said, according to Bloomberg. “It will take some time, yes, and it will take more time for locations that are experiencing higher degree of disruption,” Georgieva said in comments aired Sunday on CBS’s Face the Nation ahead of this week’s spring meetings of the IMF and the World Bank. “That’s why we need to remember the asymmetry of this shock.” Georgieva reiterated that the IMF will lower its global growth forecast as a result of the war in Iran. “We are going to have a downgrade, and the size of this downgrade will depend on these two things, duration and speed with which everything can come back to the same level of production that we had before,” she said.
A tentative agreement has been reached between JBS and the union representing workers at the company’s Greeley, Colorado, plant following a three-week strike, the union announced Friday, according to the Denver News 7 TV station. The agreement comes after workers returned to work last Tuesday, and the company and union came back to the bargaining table last Thursday. United Food and Commercial Workers Local 7, the union representing workers at the meatpacking plant, said the tentative agreement would be presented to workers for a ratification vote Sunday. The agreement is set to cover 3,800 Greeley workers, according to the union.
CORN: May corn futures gapped higher to open the night. Following trade saw the contract dip just slightly lower, partially erasing those gains. Resistance remains is at the psychological $4.50 mark, with initial support at $4.42 3/4.
SOYBEANS: May soybeans also fell from the overnight open highs, albeit slightly more than corn. Soybeans are now at the high-end of the trading range that has been in place since mid-March. Resistance is at $11.83 1/2 with support at the 40-day moving average of $11.70.
WHEAT: May SRW futures saw continued strength in the overnight, demonstrating how closely the commodity can follow price action in oil. Resistance is at the 10-day moving average of $5.91 3/4. Firm support exists at last week’s low close of $5.71.
LIVESTOCK CALLS
CATTLE: Choppy/higher
HOGS: Choppy
CATTLE: Live cattle futures are expected to open slightly higher with support from the strong weekly close on Friday. Light volumes of cash trade that showed firmer prices at midweek last week also indicated support for futures. Choice boxed beef prices remain sluggish, falling 19 cents on Friday to $380.90
HOGS: Lean hogs are expected to open choppy to start the week. Cash fundamentals have been sideways to slightly weaker recently. The CME lean hog index is down a penny to $90.30, with tomorrow’s projected index down another penny to $90.29.