Ahead of the Open | February 12, 2024

Ahead of the Open
Ahead of the Open
(Pro Farmer)

GRAIN CALLS

Corn: 1 to 3 cents higher.

Soybeans: 8 to 10 cents higher.

Wheat: Steady to 2 cents lower.

GENERAL COMMENTS: Corn and soybeans saw corrective gains overnight though saw increased selling into the break. Wheat favored the downside, though went into the break near unchanged. Outside markets were relatively quiet overnight as front-month crude oil futures saw mild corrective selling and the U.S. dollar index traded modestly higher.

Southern Brazil continued to dry out during the weekend as temps were warm while rainfall was minimal. World Weather Inc. says needed rains will move into these areas Tuesday through Thursday. Another round of dry weather is expected during the middle to latter part of next week. Rains were more significant from Mato Grosso to western Bahia during the weekend. Northern Brazil will experience net drying Tuesday through Friday of this week and then a pattern alternating rain and sunshine is expected for the weekend and next week. Rains were more sporadic and lighter than expected in Argentina during the weekend. World Weather says most of Argentina will receive rain early this week with central and northern areas expected to be the wettest. Drying is expected late this week through the weekend across Argentina.

Brazil’s soybean harvest reached 23% complete as of last Thursday, according to AgRural, the second fastest pace on record behind 26% in 2018-19. AgRural noted with more than half of the soybean crop harvested in Mato Grosso, attention is on conditions in southern Brazil. The firm estimated safrinha corn planting jumped to 38% done. AgRural raised its safrinha corn production estimate nearly 5 MMT to 91.2 MMT, citing expectations farmers will plant more area to the crop than previously estimated. It estimates safrinha corn plantings will decline 4.7% from year-ago, though that’s less than the 9.4% drop it previously expected.

Most Asian markets are closed today for Lunar New Year celebrations, including China, Singapore, South Korea, Taiwan and Malaysia. Asian markets will be closed for varied periods of time for the holiday. China’s markets reopen Feb. 19.

CORN: March corn futures saw corrective gains overnight. Bulls are seeking to overcome resistance at $4.33 1/4 then the 10-day moving average at $4.37 3/4. Support stands at $4.29, $4.28 1/4, then the psychological $4.25 mark.

SOYBEANS: March soybean futures made up most of Friday’s losses overnight. Resistance stands at the 10-day moving average at $11.98, quickly backed by the psychological $12.00 mark then the 20-day moving average at $12.12 1/2. Meanwhile, support stands at $11.83 1/2, $11.79 1/4, then the psychological $11.75 mark.

WHEAT: March SRW futures continue to lack much direction. Resistance stands at $5.98 3/4 with backing from the 40-day moving average at $6.01 3/4, then last week’s high of $6.06 3/4. Support stands at $5.91, $5.88 1/2, then $5.83.

 

LIVESTOCK CALLS

CATTLE: Higher.

HOGS: Lower.

CATTLE: Live cattle futures and feeders are expected to open higher on reports of sharply higher cash cattle trade. Futures continue to march higher on the daily bar chart. Late last week, prices consolidated as cash cattle trade was pushed late into the week. Friday, cash cattle trade surged, which should underpin futures today. When weekly cash trade data is released later this morning, it will give insight to how many cattle were sold. Poor packer margins are likely to limit packers’ willingness to bid for cattle, especially as wholesale beef prices continue to consolidate. Choice cutout fell 97 cents to $294.04 while Select rose 96 cents to $285.08 on Friday.

HOGS: Lean hog futures are expected to open with a weaker tone as cash fundamentals erode. April futures closed higher on Friday though well off intraday highs, indicating sellers are waiting above the market. The CME lean hog index fell 40 cents to $73.60 (as of Feb. 8), marking back-to-back declines for the first time since late December when the index was forging a seasonal low. February futures finished Friday 7.5 cents above the most recent cash quote, as the contract expires Wednesday at noon. Wholesale pork prices fell 39 cents to $85.97 on Friday, as gains in butts and ribs were offset by losses in all other cuts.

 

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