Ahead of the Open | March 23, 2022
GRAIN CALLS
Corn: 3 to 5 cents higher.
Soybeans: 11 to 15 cents higher.
Wheat: 12 to 16 cents higher.
Weather favors Russia’s winter grain crop, signaling good prospects, state weather forecaster Hydrometcentre said. Winter grains in the main producing regions – Russia’s south and the North Caucasus – are developing well, and only 10% of the area in other regions are at risk of poor conditions. Russia is expected to produce 123 MMT of grain this year, according to the latest ag ministry forecast, up from 121.3 million MMT in 2021.
USDA Secretary Tom Vilsack said it is too early to tell how Russia’s war with Ukraine will have on consumers and global food supplies. While touring the exhibition of farm equipment on the National Mall Tuesday, Vilsack said that 80% of what farmers harvested in Ukraine last year has already been shipped. As for the planting season ahead, Vilsack said: “We don’t know whether there are sufficient fuel needs being met so farmers can put crops in the ground. We don’t know what their machinery situation is. We don’t know whether they… are physically able to farm,” he said.
A Bunge facility in Ukraine sustained damage after the Mykolaiv port was “hit,” according to a statement by the company. Preliminary reports show some damage happened to the structure, but all employees are safe, the company added. The facility has been closed since Feb. 24 when Russia’s invasion of Ukraine began.
Russia may need at least 1 trillion rubles ($9.7 billion) for this season’s sowing of all crops, including wheat, sunflowers, potatoes and sugar beets, Kommersant reports, citing unidentified people from the industry. If so, it implies 20% growth from last year and is caused by sharp increases in prices of seeds and imported spare parts.
USDA’s Animal and Plant Health Inspection Service (APHIS) confirmed highly pathogenic avian influenza (HPAI) in a flock of 570,000 commercial broiler chickens in Butler County, Nebraska, the first commercial flock confirmed with HPAI in the state. This brings the number of states with commercial flocks infected to eight and total cases of HPAI to 51 as of March 22.
CORN: May corn futures traded within Tuesday’s range overnight after falling 3 1/4 cents yesterday to $7.53. Initial resistance is seen at this week’s high of $7.65 and support as this week’s low of $7.43. The Energy Information Administration reports weekly U.S. ethanol production at 9:30 a.m. CT. A week ago, EIA reported production during the week ended March 11 averaged 1.028 million barrels per day (bpd), down 2,000 bpd from the previous week but up 5.9% from the same week in 2021.
SOYBEANS: May soybeans traded within yesterday’s range overnight after rising 5 1/2 cents yesterday to $16.96 1/2, a lifetime-high close for the contract for the second straight session. Initial resistance is seen at yesterday’s high of $17.20 3/4, the contract’s highest intraday price since $17.34 on March 9.
WHEAT: May SRW wheat traded within yesterday’s range overnight. Initial resistance is seen at yesterday’s high of $11.69 1/4, also a two-week high, with support at yesterday’s low of $11.02 1/4. Prospects for more moisture in the U.S. Plains HRW belt could limit price gains.
LIVESTOCK CALLS
CATTLE: Steady-weaker
HOGS: Steady-firmer
CATTLE: Live cattle futures fell the previous two sessions and may face further pressure with cash trade slow to develop this week. Few packers are stepping up with bids and some feedlots, especially in the northern market, haven’t issued initial asking prices. Cash trade may not get established until Friday, after USDA releases its monthly Cattle on Feed Report, which is expected to show record March 1 inventories. Firm wholesale beef may support futures. Choice cutout values rose $1.47 yesterday to $259.97, near a one-month high. Movement was strong at 125 loads.
