Markets await Seedings/Stocks report at 11:00 a.m.

Grain futures stabilized overnight, while soybeans recovered with the return of buying interest in bean oil from end-users. After 3 limit down sessions of the past 4 trading days, end-users or importers added to their coverage, as it was reflected that soy oil open interest rose 4098 contracts in yesterday's activity. After the release of today's data, there is one full trading session on Thursday before we close for a three-day holiday internationally on Good Friday in preparation for Easter.

Today's data at 11 o'clock has average trade guesses for March 1st corn stocks of 7,767 Mil Bu, with wheat 1,272 Mil Bu, and soybeans at 1,534 Mil Bu. Such corn stocks would be down 185 Mil Bu, wheat down 143 Mil Bu, and soybeans 691 Mil Bu from last year. Combined March US major grain stocks are down 1,019 Mil Bu. March US seeding intention estimates are 93.21 Mil acres of corn, 90.0 Mil acres of soybeans and 45.0 Mil acres of wheat. The US combined corn and soybean seeding area is estimated at a record large 183.2 Mil acre, 1.2 Mil acres more than the February USDA Outlook Forum. This should make it difficult to reach 183.5 Mil acres or more of combined US corn and soybean seedlings.

A flash drought is developing across the winter corn areas of Brazil that must be closely monitored. Sometime in the first ten days of May, the dry season starts typically across Brazil, and this year's dry season will likely be ushered in by the ending of La Nina. The need for rain in the last 20 days of April is increasing. The Argentine forecast is dry also with little rain over the next 10 days. Near normal temps are forecast. The dry weather will speed the onset of harvest.

Cattle futures consolidated early week gains on Monday yesterday, with feeders finding support from weaker corn prices. Feeder cattle will be watching the sharp movements up or down in the feed markets. Cash cattle markets were quiet across the Plains on Tuesday. A few pens sold in the TX for $116, or $1 over last week. Better interest is expected to develop today, with feedlots targeting $118-120, as the beef market soars. Boxed beef prices jumped to strong gains on Tuesday. The choice cutout gained $5.30 to $244.83, and select was up $3.42 at $235.92. The choice cutout quote is the highest for late March since 2015 and the 2nd highest on record. 

Seasonally, the beef market tends to reach a high in May, but the market has been trading 2-3 weeks ahead of the normal seasonal turns. If that trend holds up, a high could be in place by late April or early May. The combination of strong domestic demand and a record export pace should reflect the improving cash trade to remain firm well into spring.