Old crop pricing leads overnight rally.

Night session trading found renewed buying in old crop corn and beans with the upcoming April WASDE report out this Friday. The report is anticipated to raise 20/21 US corn exports and feed/residual use. Dry weather is now starting to be noticed in the ongoing weather trends across the Dakotas/Canadian Prairies, Ukraine, & Brazilian winter corn areas. Minneapolis wheat closed higher yesterday while the two other wheat exchanges closed lower. The MWE exchange led overnight strength. The ongoing acute dryness across N Dakota and the Canadian Prairies is garnering trade attention, with the 10-14 day forecast offering just a few spots of rain.

Overnight the Russian Gov’t approved a formula-based export tax system for sunflower oil and a higher tax for sunflower seeds in a drive to control domestic inflation heading into key September Duma elections. The sunflower oil tax will be 70% on the difference above $1,000/MT starting on September 1, 2021. The export tax on sunflower seeds will BE 50% on price levels above $320/MT for the period of July 1 to August 31, 2022. And for the same period, rapeseed exports will be taxed outright at 30%. The new duties will further restrict Russian oilseed and vegoil exports to the world into mid-2022.

The 2nd Brazilian corn crop is coming under further weather stress with limited rain forecast over the next 10-14 days. With the start of the dry season looming in early May, the time for soaking needed rain for their corn crop is quickly fading. The drier weather forecast for Brazilian corn is worrisome, with their domestic market at a record high at over $7.00/Bu. Brazil is the world’s 2nd largest exporter of corn of over 1.3 Bil bushels annually. The best chance of rain for N and C Brazil is in the coming days, but totals have been diminished from prior forecasts. And the 8-14 day period is arid with less than .50” of rain for Parana, Mato Grosso Du Sol, and S Mato Grosso and Goias. .25-1.00” will fall across the Mato Grosso.

A new round of contract highs again yesterday for live cattle and feeder cattle from the August contract forward, making new contract highs yesterday. Cash trade is minimal so far, but early quotes on Tuesday were $3-4 higher for the week at $121, but still $1.70 under April cattle futures. Sharply higher trades on Tuesday and the beef rally have cattle feeders hoping for even higher prices by late week. The boxed beef rally continued Tuesday. The choice cutout gained $4.10 to $262.77, and the select value gained $1.44 to $251.30.