Row crop prices recovered overnight with wheat trading volatile.
Grain futures are mostly higher this morning with wheat lower, as a grain trade recovered overnight on news that Pres. Putin gave an angry speech to the Russian people and stated that they needed to cleanse Ukraine of “traders and Western aligned scum,” which reveals that any consideration of truce talks making headway a moot point. If this is an indication of Putin’s attitude after being called a war criminal by the US president, then fighting could extend well into May. Unfortunately for the Ukrainian farmers, planting season gets underway in a few weeks, and their window closes by midway to get their corn crop in for optimal production.
Yesterday the US central bank increased interest rates by .25% on the Fed funds lending rate and stated during the next six Fed meetings through the course of the year a .25% increase will occur. Left out of the equation yet was the shutting off of the monthly purchasing of mortgage-backed securities and other assets. It’s this ongoing QE that has helped fuel inflation.
Argentina on Sunday had closed their exports of meal/oil and are looking to reopen trade today by increasing their export tax from 31% to 33%. Traders are hopeful that the markets will reopen with the 2% tax increase. Food inflation is surging across Argentina, but the world does not desire Argentina to utilize export controls. It is anticipated that Argentina will use increased tax to pay off IMF loans.
Iran received its tender for wheat from Australia, with Jordan also tendering to secure 120,000 MTs. Argentina’s exportable corn basis continues to rise on elevated demand while a sharp fall and Brazilian FOB soymeal occurred on their expanding crush pace.
Forecasts of rainfall continue for the eastern and central plains next week with the potential of 1.50-4.00” for the Delta and Gulf states. The Western wheat belt is hopeful it will experience 1.00” potential rain.
Live cattle futures closed lower yesterday, with feeder cattle closing firmer on the week grain market. There was limited cash business with the few thousand head in the Plains market trading in the $140-141 range, which was $2-3 higher than last week. Dressed trade was at $222, which was $2 higher for the week. Live cattle futures turned lower just below noted chart resistance of 138.50-139.50 for the summer live cattle contracts.