LEADING OFF: Grain and oilseed futures are firm leading in to this shortened trading day amid technical buying and short-covering, and outside market support. Wheat is leading the way on a percentage basis, up 5 to 6 cents with support from pessimism about a Ukraine-Russia peace deal and weather threats in the U.S. Plains and Russia. Soybeans are also up 5 to 6 cents, and corn is up 1 to 2 cents. Cotton is up 10 to 20 points. All of these markets are building off gains the past couple of days.
The strength in the grains is part of a broader story this week. Wheat has settled higher each of the past four days, corn and cotton four out of the past five days. Along with that, crude oil has settled higher each of the past five days, while gold and silver have surged again to new all-time highs. Outside markets are more subdued this morning. Gold is up slightly, the dollar index is down slightly, and crude oil is slightly higher. U.S. equity futures indexes are pointed to a quiet open, after the S&P 500 made another all-time high yesterday.
Ahead of Christmas, the grains markets close at 12:05 p.m. CT today, and livestock closed at 12:15 p.m. Markets will remain closed on Thursday for Christmas and won’t re-open until Friday morning at 8:30 p.m. Trading volume should be light throughout, with many traders getting a head start on holiday festivities today or making an extended weekend of it. Federal government offices are also closed, as both Dec. 24 and 26 have been declared holidays.
The thermometer will swing wildly over the next several days in the central U.S., starting with a Christmas heat wave across the central and southern Plains thanks to a high-pressure ridge. Temperatures will reach into the 70s and 80s, and potentially even hit 90 in northwest Texas according to World Weather Inc. The swing in temperatures will stress livestock, and feed concern about dryness for hard red winter wheat. Then come Sunday there will be a significant plunge in temperatures, which will stay well below normal for at least a couple of days.
CORN: March futures posted their highest close in 10 sessions yesterday, but settled below midrange for the day. It has nearby chart resistance at $4.49 and $4.52 1/4, with key resistance remaining at $4.57. Nearby support is at $4.46 1/4 and $4.42 1/2-$4.43. While corn futures have worked their way back toward the top of their recent trading ranges, gains over the past 5 sessions have come in very low trading volume and a marginal drop in open interest.
Strong demand has underpinned this market even amid the recent slide in soybeans and wheat. With the government closed fresh demand news will likely be limited over the next few days. The EIA’s weekly Petroleum Status report containing ethanol production data for the week ended Dec. 19 will be released on Monday, Dec. 29.
SOYBEANS: South American weather remains largely favorable. Both Brazil and Argentina will see timely rainfall and a good mix of temperatures over the next two weeks, World Weather Inc. says. The main concern is southern Argentina, particularly La Pampas and Buenos Aires, which will see net drying over the next week to 10 days. However, it will not be completely dry. Northeastern Brazil will also see some drying. Heavy rains could cause some localized flooding in in northeastern Argentina and Rio Grande do Sul in Brazil in the coming week .
WHEAT: The volatile weather outlook for the Plains is providing some support, particularly for K.C. hard red winter wheat. Longer-term, World Weather has said that a weakening La Nina should provide some rain opportunities in the Plains as the winter progresses. But right now the region is looking at hot, potentially record-breaking heat with a lack of rain in the coming days. Then that will be followed by a temperature plunge. With the current warmth eroding snow cover further and further north, sub-zero temperatures late this weekend into early next week could potentially cause some damage to exposed winter wheat, World Weather Inc. says. The risk of market-moving damage, however, is low. Wheat also may be getting some support from severe cold weather in Russia that is raising winterkill concerns.
Russia has set its grain export quota for the second half of the marketing year from Feb. 15 to June 30 at 20 MMT, Reuters reported this morning. That is twice the amount of a year ago, indicating confidence in increased exports over the next several months. Russian Deputy Prime Minister Dmitry Patrushev in a newspaper interview published Tuesday blamed low global prices for stalling Russian grain exports in the current marketing season, stressing that Russian grain is still in demand.
Algeria’s state grains agency OAIC is believed to have purchased between 500,000 and 550,000 metric tons of durum wheat in an international tender on Tuesday, Reuters reported. Shipment was sought in four periods in 2026 between Feb. 1 and March 31.
LIVESTOCK: Lean hog futures went into yesterday’s quarterly Hogs and Pigs report technically overbought, and it could be vulnerable to significant pressure this morning after that report came in bearish. USDA pegged the total U.S. hog herd as of Dec. 1 at 100.6% of a year earlier, above trade expectations that averaged 99.1% in a range from 98.3%-100.0%. The Dec. 1 market hog inventory came in at 100.8% of a year earlier, topping trade expectations that averaged 99.2%. The report did show continued sow herd liquidation as the breeding herd matched the average of trade expectations at 99.1% of a year earlier.
In total the Dec. 1 market hog inventory appears to have been about 1 million head above the avg. of trade expectations. The supply of hogs in the heavier weight classes was above a year earlier, indicating larger-than-expected supplies for the 1st qtr. of 2026. However, the larger market hog inventory was due in large part to a larger-than-expected Sep.-Nov. pig crop driven by larger-than-expected Sep.-Nov. farrowings.
In the livestock complex, Plains cash cattle trade was light yesterday, at $228-29 in the southern Plains on a live basis, and at $228-29 in Nebraska. In both cases this is steady with last week. Dressed trade in Nebraska was at $356. Packers are again dealing with deeply negative margins: $199 per head in the red today according to HedgersEdge.
