Commodities lower as Putin comments of positive truce developments.
Grain futures gave up overnight gains and moved lower in the early morning hours along with crude oil and metals from comments that Putin stated there was a positive shift in cease-fire talks with Ukraine without being specific. Reuters broke this story in the early morning hours, which slumped the commodity markets and helped equity futures rally. It is suspected that Putin is pointing to Ukraine’s willingness to commit not to join NATO. The fly in the ointment here is that Putin is likely seeking a political regime change in Ukraine before relenting on the war.
Expectations are growing that the EU could approve US GMO corn amid the feed shortfall produced by the Russian/Ukraine conflict. Moscow has retaliated against NATO members with new sanctions. Russia banned exporting telecom, medical, and forest products along with a host of other goods into the end of 2022. Russia also restricted foreign ships from entering Russian ports and nationalized leased airlines. In addition, Russia is banning grain exports to former Soviet countries that formed the EEU from March 15-August 31.
The market is trading volatile headlines, and any hope of a cease-fire creates quick continual liquidation since last Tuesday’s high. However, the Russian war is still ongoing, and the political anxiety stays elevated. The NATO economic sanctions will remain in place for a considerable amount time due to Putin’s actions in Ukraine. It is widely thought that until Putin is replaced as Russian Pres., chances for Black Sea grain trade to resume will be low likely through the end of this year. Liquidated markets will likely find support values near $10.00 wheat, $7.10-7.25 corn, and $16.00-16.20 soybeans with end-user pricing.
Near normal rain is falling in the Brazilian Ag areas that need rain for the winter corn in central Brazil. A drier weather trend is now sitting up across Argentina for the next two weeks. Seasonal temperatures prevail for the late-planted corn and soybeans, with highs in the 80s/mid-90s. Except for winter corn in Brazil, late-planted corn and soybeans are nearing maturity and the impact of weather is now on the decline. In Brazil, April/May weather will be monitored for the winter corn crop.
Live cattle and feeder cattle futures again moved lower Thursday, with critical attention focused on lows placed earlier in the week need to hold, or further technical liquidation will continue. The cash cattle trade was limited on Thursday, with sales similar to earlier in the week at $138-140. Boxed beef prices firmed on Thursday, with the choice gaining $1.24 to $253.94, and select was higher by $2.58 to $247.37. January US beef exports showed 288 Mil Lbs were exported, which was steady with December but showed a 42 Mil Lbs increase over last year, and it was a record large number for January. Exports to China were 26 Mil Lbs larger than last year, with exports to South Korea up 23 Mil Lbs.