Ahead of the Open | April 23, 2024
GRAIN CALLS
Corn: 1 to 3 cents lower.
Soybeans: 1 to 3 cents lower.
Wheat: Winter wheat steady to 2 cents higher; HRS 3 to 5 cents higher.
GENERAL COMMENTS: Corn, soybeans and wheat favored the upside in early overnight trade, though sellers emerged early this morning, bringing corn and soybeans below yesterday’s close. Gold futures continue to face heavy selling pressure and front-month crude oil futures are trading near recent lows. The U.S. dollar index have been consolidating off recent highs and is currently trading around 75 points lower.
USDA rated 50% of the winter wheat crop as “good” to “excellent,” down five percentage points from the previous week. The amount of crop rated “poor” to “very poor” increased three points to 16%. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop dropped 11.4 points to 325.6, led by a 7-point decline in top producer Kansas. The SRW CCI rating improved 3.4 points to 385.5, led by a 1.4-point increase in top producer Illinois. Click here for details.
A third temporary channel has been opened at the site of the Francis Scott Key Bridge collapse. Commercial vessels can now use the Fort Carroll Temporary Alternate Channel. However, this temporary channel is distinct from the limited access channel expected to open by the end of April. The U.S. Army Corps of Engineers anticipates opening the limited access channel to the Port of Baltimore by the end of April, supporting one-way traffic for barge container service and certain vessels transporting automobiles and farm equipment.
South American crop consultant Dr. Michael Cordonnier left his Brazilian crop estimates at 147 MMT for soybeans and 112 MMT for corn. He has a neutral to slightly higher bias toward both crops, though with soybean harvest winding down, much of the focus is on the safrinha corn crop. Early maturing safrinha corn should have generally favorable yields, while weather will determine yields on later-planted acres. Cordonnier left his Argentine crop estimates at 51 MMT for soybeans and 50 MMT for corn. His bias is neutral toward soybeans and lower for the corn crop, depending on damage from corn stunt disease, which continues to spread across northern and central areas of the country.
Ukraine grain exports might total 6 MMT to 7 MMT in April despite Russian attacks on Ukrainian port infrastructure on the Black Sea, industry sources told Reuters. Russia has stepped up attacks on Ukrainian seaports, damaging grain storage facilities in the Port Pivdennyi in Odesa region. Local media reported one of the strikes may have damaged railway tracks to the port of Chornomorsk cargo terminals in the region.
Dry weather is expected to persist in the west-central northern Plains through the next ten days, World Weather Inc notes. Rains is expected across the Midwest, Delta and eastern Plains from late this week through the following ten days, which will likely cause delays in planting.
CORN: May corn futures saw modest profit-taking overnight. Initial resistance stands at Monday’s high of $4.41. Additional buying sees resistance at $4.45 then the March 28 high of $4.48. Support comes in at $4.36 1/4, which is quickly backed by $4.35 1/2, then $4.33 3/4.
SOYBEANS: May soybean futures posted modest losses overnight. Initial resistance stands at $11.65 3/4, which capped most losses overnight. A daily close above that mark would shift some much-needed momentum to the bulls. Further buying finds resistance at $11.77 1/4. Support stands at $11.58 with backing from $11.51 then $11.45.
WHEAT: May SRW futures saw followthrough buying overnight. Initial resistance stands at $5.81 1/2 with backing from $5.84 1/4, then $5.99 1/4. Support comes in at $5.67 1/4 then the 40-day moving average at $5.59 1/4.
CATTLE: Higher.
HOGS: Higher.
CATTLE: Live cattle futures and feeders are expected to start with a firmer tone in a continuation of Monday’s technical strength. June live cattle futures gapped higher and closed at the highest mark in three weeks on Monday. Meanwhile, the cash cattle average fell $1.17 to $182.67 last week, marking the fourth consecutive weekly drop. Strength in the futures market could spill over to the cash market, especially considering that April futures are now trading above the cash market. Still, showlist numbers are expected to be higher this week, especially in the Southern Plains, which could limit packers’ willingness to pay up for cash cattle. Wholesale beef prices ended Monday modestly firmer, as Choice cutout firmed 26 cents to $295.93 and Select rose $1.04 to $291.87, narrowing the Choice/Select spread to just $4.06.
HOGS: Lean hog futures are expected to open higher, building on recent strength. Traders’ expectations have recently turned more bullish despite modest weakness in the CME lean hog index, which is down another 4 cents to $91.31 as of April 19. While the index has fallen for two consecutive days, sustained weakness is not expected. The premium May futures hold to the cash index stands at $5.39, over $2.00 above last week at this time. Wholesale pork values ended Monday firmer, driven by strength in bellies, ribs and picnics, which offset modest losses in other cuts. Cutout strength continues to maintain packers’ margins solidly in the black, which could lead to renewed strength in the cash hog market.
