Good morning!
Grain futures up slightly overnight… As of 6:00 a.m. CST, March corn futures were up 1 3/4 cents and hit a two-week high. January soybeans were up 2 3/4 cents. March SRW and HRW wheat futures were up 1/4 to 2 1/4 cents. Look for quieter trading action in the grain futures today, as many traders will be hitting the exit doors early to get a jump on the Christmas holiday. Grain market bulls are encouraged this week by soaring gold and silver prices that hit record highs overnight. Also, the key outside markets lean price-friendly for the grains early this week as the U.S. dollar index is lower early today and is trending down. Nymex crude oil futures prices are a bit firmer today, hit a two-week high and have rebounded smartly from last week’s eight-month low--presently trading around $58.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.15 percent.
Mild temps, calm conditions for Midwest, Plains… The National Weather Service today reports much of the Midwest and Plains states will see mild temperatures and no major winter storms the rest of this week. Meantime, moisture streaming northward out of the Gulf will aid in developing rain over parts of the Ohio/Tennessee Valleys and the Mid-Atlantic through this afternoon. The rain will then concentrate over the Tennessee Valley Tuesday evening through Wednesday morning. In addition, moderate to heavy snow will develop over the Northeast Tuesday through Wednesday morning. Rain is forecast over parts of the Ohio Valley Wednesday, moving into parts of the Mid-Atlantic by Christmas morning. Pockets of rain/freezing rain will develop over parts of the Great Lakes and Northern Mid-Atlantic overnight Christmas Eve into Christmas Day. Rain and higher-elevation snow are forecast over parts of the Pacific Northwest and the northern intermountain region. Heavy snow will develop over the Sierra Nevada Mountains through Thursday. Rain and the highest elevations now will develop over the Great Basin and the Southwest and move into the central Rockies by Christmas day.
Trump warns Venezuelan leader: Don’t mess with the U.S. … President Trump warned Venezuelan President Nicolas Maduro not to challenge the United States and vowed to keep oil seized from a supertanker. Trump declined to say if he’s seeking to oust Maduro, saying, “That’s up to him” when asked if he would try to push Maduro out. The U.S. has stepped up its blockade of tankers going to and from Venezuela, boarding a non-sanctioned ship and pursuing another oil tanker off the coast of Venezuela. More than a dozen tankers have loaded oil off Venezuela’s coast since the Trump administration intensified efforts to curb Caracas’ crude revenue by targeting sanctioned vessels, Bloomberg reported. Since Dec. 11, roughly 14 vessels have loaded and at least six of them were under sanctions, according to data from maritime intelligence firm Kpler. The majority of the loadings took place at the ports of Bajo Grande and Puerto Jose, said Bloomberg.
Russia continues to attack Ukraine as peace talks drag on… Russian forces launched a missile and drone attack across Ukraine, killing civilians and hitting energy targets as negotiators pressed ahead with talks to end the nearly four-year war. President Volodymyr Zelenskiy said the strikes on several Ukrainian regions, with some 650 drones and more than 30 missiles, took place “in the midst of negotiations,” as Kyiv’s team returned home from talks with U.S. officials in Florida. “This Russian strike sends an extremely clear signal about Russia’s priorities,” Zelenskiy said on Tuesday on X and as reported by Bloomberg. He slammed the attack, taking place “ahead of Christmas, when people simply want to be with their families, at home, and safe.” On the diplomatic front, US President Donald Trump, whose administration is placing Kyiv under mounting pressure to agree to a peace deal with Russia, said the effort was moving ahead. Talks are “going along,” the US leader told reporters in Florida in response to a question on whether three-way discussions between Washington, Kyiv and Moscow may be the next step.
Russia’s attacks on Ukraine’s Black Sea grain facilities crippling export capacity… A Russian drone strike late Monday damaged port facilities and a civilian vessel in Odesa, Ukraine’s regional governor Oleh Kiper said on Telegram and as reported by Bloomberg. The ship had been transporting soybeans, according to Vice Prime Minister Oleksiy Kuleba. The country is a major exporter of grain and vegetable oil. Infrastructure at Russia’s Black Sea port of Taman was also struck this week. “Ukraine is currently experiencing significant problems in the logistics of grain exports due to constant Russian terrorist attacks on critical infrastructure,” the Ukrainian Grain Association said in a statement. “Railways and ports cannot operate at full capacity due to damage to their infrastructure, electricity shortages and constant outages.”
One-third of USDA Washington, D.C., employees leave the department in first half of this year… About one-third of the U.S. Department of Agriculture’s employees in the Washington, D.C., area left the agency from January to June, according to a report from the agency’s Office of Inspector General. More than 1,000 employees at the agency’s Washington, D.C., headquarters have departed and about 18% of the USDA’s total employees left during the period. The U.S. Forest Service, Animal and Plant Health Inspection Service, National Resources Conservation Service, National Institute of Food and Agriculture, and National Agricultural Statistics Service were among the areas that lost employees. The moves came even before USDA said in July that it would more than halve its Washington, D.C.-based workforce and relocate employees elsewhere, sparking concern about further departures. A spokesperson said USDA aims to “return the department to a customer-service focused, farmer-first agency,” and added that it has not stopped hiring for critical roles that protect Americans, national forests and food safety, said a Bloomberg report.
New records: Gold above $4,500, silver above $70… Gold prices overnight climbed to a fresh record high of $4,530.80 an ounce, basis February Comex futures. March Comex silver futures also hit a record high of $70.155 an ounce overnight. Gold marked its 50th record-breaking session this year, as both metals are driven higher by safe-haven demand amid escalating U.S.-Venezuela tensions, as well as expectations of more U.S. interest rate cuts later next year. So far this year, gold has soared 70%, on track for its strongest annual gain since 1979. Silver is up over 130% this year.
Cattle futures continue to climb… February live cattle on Monday rose 62 1/2 cents to $231.425 and hit a two-month high. January feeder cattle gained 90 cents to $346.50, also hitting a two-month high. The cattle futures markets saw more chart-based buying from the technically oriented speculators as the charts remain bullish. A bullish USDA cattle on feed report last Friday afternoon also helped push futures prices higher Monday. USDA reported cash cattle trading last week averaged $227.97, which is down 22 cents from the prior week’s average.
USDA quarterly hogs and pigs report and cold storage report on deck… Lean hog futures on Monday rose 85 cents to $85.35 and hit a two-month high. Lean hog futures saw technical buying from the speculative traders. Recently rising cash hog prices and a bullish near-term chart posture for the futures market will likely continue to support buying interest in lean hog futures. The February futures contract is above the latest CME lean hog index, which is also a positive. The latest CME lean hog index is down 15 cents to $83.73. Today’s projected cash index price is down 2 cents at $83.71. Monday’s national direct 5-day rolling average cash hog price quote is $69.67. Hog traders are awaiting the quarterly USDA hogs and pigs report and the monthly cold storage report Tuesday afternoon. The hogs and pigs report is expected to show a decline in inventories and kept for breeding numbers.