Grain Highlights: Top Stories of the Day

Features Dow Jones Newswires

TOP STORIES

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Crude Oil Boosts Wheat, Soybean Markets

A rally in crude oil prices helped bolster grain-and-soybean futures on Wednesday.

February-dated crude-oil futures rose 2.2% to $61.72 a barrel, hitting the highest point in two-and-a-half years. That added strength to the broader commodity sector, and traders bet that funds and other speculative buyers would show more interest in agricultural markets in 2018.

Wheat futures for March delivery rose 0.6% to $4.36 a bushel at the Chicago Board of Trade. January soybean contracts rose 0.5% to $9.59 3/4 a bushel while March corn contracts fell 0.1% to $3.53 a bushel.

Crop Glut Pressures Cargill Profits -- Market Talk

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9:22 ET -- Another large U.S. corn and soybean crop this year added to pressure on Cargill's grain trading and processing division, which helped push the agricultural conglomerate's overall earnings down 6% in the most recent quarter. Global demand is growing, but not fast enough to soak up rising global grain stockpiles, which Cargill said "weighed on markets, diminishing volatility and trading opportunities." Cargill's fiscal Q2 net earnings were $924M, as sales rose 8% to $29.2B. (jacob.bunge@wsj.com; @jacobbunge)

STORIES OF INTEREST

Tax Law Could Bring 'Material Cost' to Cargill -- Market Talk

10:18 ET -- Cargill is still assessing the impact of last month's US tax overhaul on one of the biggest U.S. food companies, but a spokeswoman says the company "may incur material costs due to mandatory repatriation of accumulated foreign earnings." At the same time, Cargill's likely to see a "modest" domestic tax benefit in future years, largely through the lower corporate tax rate, she says. Cargill needs cash overseas to run operations ranging from chicken farms to financial trading, and most of its cash flow continues to be reinvested in the business, with more than $1B in acquisitions, joint ventures and new investments made over the company's most recent quarter. (jacob.bunge@wsj.com; @jacobbunge)

Traffic, Sales Data Negatives for Kroger -- Market Talk

11:29 ET -- JPMorgan analysts are skeptical that Kroger's strong 3Q performance will last, arguing that stock-up trips prior to last year's hurricanes likely helped the U.S.'s largest supermarket chain beat expectations. Orbital Insight satellite data forecasts a 1.1% fall in traffic at established Kroger stores so far in 4Q over the previous year. Nielsen sales data for grocery also showed weakness for the last two months of the year. "We remain somewhat skeptical that last quarter's bump .... will be wholly sustainable," the analysts write. Kroger slips 1.4% to $27.89.( heather.haddon@wsj.com; @heatherhaddon)

THE MARKETS

Cattle Futures Mixed; Beef Prices Sizzle

Cattle futures were mixed as buying interest cooled after recent gains.

February-dated contracts for live cattle fell 0.3% to $1.2295 a pound at the Chicago Mercantile Exchange, while later-month futures were higher.

CME February lean hog futures rose 0.5% to 71.05 cents a pound.

(END) Dow Jones Newswires

January 03, 2018 17:40 ET (22:40 GMT)