Good morning!
Grain futures mixed overnight… As of 6:00 a.m. CST, March corn futures were up 1 1/4 cents. January soybeans were down 1 1/4 cents. March SRW and HRW wheat futures were near steady, with HRW poking to a seven-week low overnight. March corn bulls need to defend solid chart support at the November low of $4.34 1/2. Sell stop orders likely lurk just below that key level. January beans are presently in a steep price downtrend on the daily chart. However, the Relative Strength Index is reading well oversold and is at a level that has seen prices put in bottoms over the past several months. March SRW set a contract low Tuesday as both winter wheat markets remain trapped in price downtrends. However, RSI readings are also well into oversold territory for March SRW and HRW. Key outside markets for the grains see crude oil higher today and trading around $56.50 a barrel. The U.S. dollar index is solidly higher early today after hitting a nine-week low Tuesday. The yield on the benchmark 10-year U.S. Treasury note is presently 4.16 percent.
Dangerous high winds across much of northern United States… The National Weather Service today said hazardous weather will occur across the northern tier of the country over the next few days. Widespread damaging wind gusts of 50-70 mph are forecast across much of the Northwest, northern/central Rockies and the Northern Plains through Thursday. Higher peaks of the northern and central Rockies and their eastern slopes could experience powerful wind gusts in excess of 80 mph. These wind gusts will result in numerous power outages, scattered tree and roof damage, and dangerous travel conditions. Powerful winds combined with periods of snow across the Northern Plains are likely to produce whiteout conditions tonight into Thursday. Snow squalls traversing the northern High Plains could cause rapid reductions in visibility tonight. This will cause extremely hazardous travel. Rounds of heavy snow in the higher terrain of the Cascades and northern Rockies are expected today. Additional power outages and tree damage are possible Thursday and Friday due to a combination of heavy, wet snow causing added strain on trees and power lines. Rain at the surface and lower elevations of the Pacific Northwest mountain ranges will intensify over the coming days and exacerbate flooding of rivers, creeks and streams through Friday afternoon, at least. A strong ridge centered over the east Pacific will support above average temperatures across much of the West over the next few days. The short wave responsible for today’s dangerous precipitation and wind over the Northwest will amplify over the central U.S. on Thursday, leading to a drastic 24-hour drop in temperatures across the Northern Plains.
China selling large volumes of soybeans from its state reserves, steps up U.S. purchases… China is selling large volumes of soybeans from its state reserves, as it steps up purchases from the U.S. to fulfill an agreement between the two countries in late October, Bloomberg reports. “Beijing often auctions soybeans to manage and rotate supplies from its substantial state reserves, but these are the first sales since it resumed buying from the U.S. following the trade truce with Washington. There have already been two auctions since last Thursday, with around 720,000 tons sold out of the more than 1 million tons on offer, according to official statements and Chinese consultancy Mysteel. Authorities will hold another auction for 550,000 tons on Friday,” said Bloomberg. Chinese state firms started buying U.S. soybeans in the days before the meeting and had taken a total of 2.5 million tons by the middle of November. There have been more purchases since then, but the U.S. government shutdown has delayed data on the latest total. Privately owned crushers, meanwhile, have largely steered clear of the beans, which still incur a 13% import tariff and remain unprofitable to process. China is expected to buy at least 12 million tons of U.S. soybeans by the end of February, according to the latest remarks from officials in Washington. Beijing has not officially confirmed those numbers but has moved to reduce tariffs on the crop and lifted import bans on three U.S. exporters. The cargoes usually take around a month to get to China, and large-scale storage will be required if they’re not immediately crushed, said the Bloomberg report.
U.S. will further sanction Russian energy if Putin rejects peace deal… The U.S. is preparing a fresh round of sanctions on Russia’s energy sector to increase the pressure on Moscow should President Putin reject a peace agreement with Ukraine, according to people familiar with the matter and as reported by Bloomberg. The U.S. is considering options, such as targeting vessels in Russia’s so-called shadow fleet of tankers used to transport Moscow’s oil, as well as traders who facilitate the transactions, said the people who spoke on condition of anonymity to discuss private deliberations. The new measures could be unveiled as early as this week, some of the people said. Bloomberg said U.S. Treasury Secretary Bessent discussed the plans when he met a group of European ambassadors earlier this week. “President Trump is the President of Peace, and I reiterated that under his leadership, America will continue to prioritize ending the war in Ukraine,” Bessent wrote in a post on the social media platform X after the meeting. The Kremlin is aware that some U.S. officials are mulling plans to introduce new sanctions against Russia, Putin’s spokesman Dmitry Peskov told reporters Wednesday, according to the Interfax news service. “It’s obvious that any sanctions are harmful for the process of rebuilding relations,” he said.
Crude oil rallies as U.S. blockades oil tankers going into and leaving Venezuela… President Trump ordered a blockade of sanctioned oil tankers going into and leaving Venezuela, ratcheting up pressure on Venezuela as the U.S. builds up its military presence in the region. “Venezuela is completely surrounded by the largest armada ever assembled in the history of South America,” Trump wrote on social media Tuesday and as reported by Bloomberg. “It will only get bigger, and the shock to them will be like nothing they have ever seen before.” The move threatens to choke off the economic lifeblood of a country that was already under severe financial pressure. But it will have a less profound impact on global markets due to the diminished status of Venezuela’s oil industry. The OPEC member’s crude output has declined about 70% through more than 25 years of socialist rule to less than 1 million barrels a day.Trump said he was also designating the Maduro regime as a “FOREIGN TERRORIST ORGANIZATION.” And he accused the “illegitimate” regime of “using oil from these stolen oil fields to finance themselves, drug terrorism, human trafficking, murder, and kidnapping,” said Trump on social media. Nymex crude oil futures climbed as much as 1.7% to trade near $56.50 a barrel, rebounding from the lowest level in eight months, and was also boosted by the news of potential new sanctions on Russian energy.
Australia’s GrainCorp stock plunges 20% after loss from Canadian unit sale… Shares of Australian agribusiness GrainCorp Ltd. fell the most in five years after the firm warned that the sale of its Canadian unit would incur a loss of up to 10 million Australian dollars ($6.6 million U.S.). The stock fell as much as 20%, the most since March 2020, as the Sydney-based company said it was selling GrainsConnect Canada to Canadian firm Parrish & Heimbecker, according to a statement on Wednesday and as reported by Bloomberg. The deal values the business, which GrainCorp owns with joint venture partner Zen-Noh Grain Corp., at 150 million Canadian dollars ($109 million U.S.) and is expected to be completed in the first half of 2026. “Strong global supplies of major grains and oilseeds, as well as weak consumer demand, have weighed on GrainCorp, with its latest full-year earnings in November taking a hit. Benchmark futures for wheat — one of Australia’s biggest crop exports — are trading near a five-year low. Farmers in the nation are expected to collect their third-largest harvest on record in the current season,” said the Bloomberg report.
Silver hits another record high… Silver futures prices climbed to near $66 an ounce today, reaching new all-time highs as a mixed U.S. jobs report on Tuesday prompted traders and investors to seek silver as an alternative asset that potentially offers higher returns, and to manage risk. Silver’s rally this year, currently up nearly 130% year-to-date, is also supported by tightening silver inventories and robust retail and industrial demand, particularly from the expanding solar, electric vehicle, and data center sectors. TradingEconomics.com
Malaysian palm oil futures prices down for fourth straight session… Malaysian palm oil futures fell for a fourth straight session today, hovering below MYR 3,960 per MT to a 5-1/2-month low, amid weaker rival edible oils on the Dalian exchange. Sentiment was further dampened by lower export prospects, with cargo surveyors estimating shipments for December 1–15 dipped 15.9–16.4% from the prior month. On the supply side, end-November inventories hit a 6-1/2-year high, as strong output is on track to top 20 million MT in 2025 for the first time. Europe added pressure, with palm oil imports falling 12% to 1.35 million MT in the 2025/26 season, according to European Commission data as of December 14. Limiting the downside, reports said India’s November palm oil imports rose about 5% from October amid lower prices. In energy markets, crude oil gained over 1% after new measures targeted sanctioned shipments. Separately, the U.S. Environmental Protection Agency said it expects to finalize biofuel blending mandates for 2026–27 in the first quarter of next year.
Cattle futures markets poised for more price upside… February live on Tuesday rose 15 cents to $230.70. January feeder cattle gained $3.40 to $343.325 and closed at a seven-week high close. The live cattle futures market is pausing this week after recent good gains, and this pause is not bearish. Feeder cattle futures Tuesday saw fresh chart-based buying interest amid a price uptrend in place on the daily bar chart. Solidly higher cash cattle trade last week at much better money is also supportive for the cattle futures markets. USDA at midday Tuesday reported very light cash cattle trading at $228.00. A short-term bout of bitter cold in the far northern Plains and southern Canada Prairies today and Thursday will produce blizzard conditions and a short-term (2-day) bout of bitter cold conditions, according to World Weather Inc.
Strengthening cash market supporting lean hog futures… February lean hogs on Tuesday rose 92 1/2 cents to $84.775. Hog futures saw fresh technical buying. The near-term chart posture for the market remains bullish as prices are in an uptrend. Recent gains in the cash market and the CME hog index also suggest seasonal bottoms are in place for cash and futures markets. February lean hogs have pushed above the CME lean hog index, also a positive sign. Mexico’s Economy Ministry has opened an anti-dumping probe into U.S. pork (legs and shoulders) imports. Meantime, China lowered its final tariffs on EU pork imports. The latest CME lean hog index is up 19 cents to $82.99. Today’s projected cash index price is up another 31 cents at $83.30. Tuesday’s national direct 5-day rolling average cash hog price quote is $71.55.