Ahead of the Open | March 30, 2022
GRAIN CALLS
Corn: 8 to 15 cents higher
Soybeans: 8 to 12 cents higher
Wheat: 15 to 20 cents higher
Russian forces bombarded Chernihiv in northern Ukraine on Wednesday, a day after promising to scale down operations. Kyiv and its Western allies dismissed a pullback near the capital as a ploy by Russia to regroup from heavy losses. The Pentagon says Russia is moving troops around Kyiv, not withdrawing them. Meanwhile, the U.S. Treasury department is preparing new sanctions against Russia’s military supply chain. The aim is to hit “Russia’s ability to build and maintain the tools of war that rely on these inputs.”
Preparations are underway for Thursday’s Prospective Plantings and Grain Stocks Reports. March planting intentions have received much of the pre-report hype, but March 1 grain stocks could end up being the data that moves markets. Based on the average pre-report estimates from a Reuters survey, corn acres are expected to decline about 1.4 million acres to 92.0 million acres and soybean area is likely to expand by about 1.5 million acres to 88.7 million acres. But the range of estimates is wide for both. Traders also expect all wheat acres to rise to nearly 47.8 million acres, including 34.4 million acres of winter wheat, 11.8 million acres of other spring wheat and 1.7 million acres of durum. Cotton seedings are expected to decline modestly from last year to 12.0 million acres. Traders expect March 1 stocks at 7.877 billion bu. for corn, 1.902 billion bu. for soybeans and 1.045 billion bu. for wheat, but the range of estimates is wide for all three.
USDA reported daily soybean sales of 128,000 MT to Mexico for 2022-23.
CORN: Corn futures regained a good portion of Tuesday’s losses in overnight trade, with the May contract reaching as high as $7.42 and finishing near session highs. A close above $7.26 3/4 would negate Tuesday’s downside breakout from the nearly four-week sideways range.
SOYBEANS: Soybeans rebounded from Tuesday’s losses overnight. May soybeans reached $16.55 and finished near session highs. A close above $16.38 would get futures back into the sideways range after a downside breakout yesterday.
WHEAT: May SRW wheat futures extended as high as $10.36 overnight and ended near session highs. The contract would have to close above $10.31 3/4 to negate Tuesday’s bearish downside breakout on the daily chart.
LIVESTOCK CALLS
CATTLE: Firmer
HOGS: Firmer
CATTLE: Live cattle futures are expected to build on Tuesday’s gains, though buyer interest may be limited as traders wait on active cash cattle trade to develop. Outside market pressures have eased from yesterday, which should spur followthrough buying. Traders expect cash cattle trade to be steady to possibly firmer, though active trade may no occur until later in the week. Today’s Fed Cattle Exchange online auction will be looked to for a possible early test of cash trade. Choice boxed beef prices firmed 63 cents on Tuesday, while Select fell $1.48. Packers moved only 87 loads of product on the day, signaling they remain selective buyers.
HOGS: Lean hog futures are expected to rebound from Tuesday’s corrective declines as outside market pressures have eased. Support will continue to come from the firming cash hog index. The CME lean hog index is up another 63 cents today to $103.56. April futures finished Tuesday $2.49 above that level, so that may limit buyer interest in the lead contract. The pork cutout value declined $3.47 yesterday after trading more than $2 higher in the morning.
USDA’s Hogs & Pigs Report this afternoon is expected to show the U.S. hog herd contracted 1.2% from year-ago as of March 1. Based on the average pre-report estimate, the March 1 hog herd is expected to total just over 73 million head, including a market hog inventory of 66.8 million head (down 1.3%) and breeding herd of 6.2 million head (up 0.1%).
