Grain futures stall overnight after mid-week higher press.
After a higher start Wednesday evening, by 8 PM, grain futures turned abruptly lower as reports of grain leakage continues and exporters/importers are finding workarounds to the sanctions. Also, several non-sanction Russian banks issued letters of credit for new transactions. As a result, world grain analysts are now starting to raise her old crop wheat export estimates from Russia after having previously slashed them following the invasion and resulting sanctions. However, this ongoing grain leakage will likely increase in the coming weeks and unless NATO members further tighten restrictions to Russian grain exports. This constant leakage from ports produces the inability of world wheat futures to sustain recent sharp gains into the early part of March.
Overnight the Ukrainian Ag minister Roman Leshchenko resigned after commenting that Russia has been targeting Ukraine’s Black Sea export facilities to limit or cut Ukraine ag exports for an extended period. Bungee confirms damage to its export facility and Mykolaiv, Ukraine.
One week from today is the NASS March Stocks/Seeding’s intentions report, historically producing sizable post-report price movements. With the spec trade still heavily involved in the grain trade, further liquidation and reduction of positions will likely be seen in the report. This will be complicated with the understanding of Ukraine’s prospect of production if the Russian/Ukrainian war does not end soon, along with Northern Hemisphere growing season weather.
Cattle close mostly higher on Wednesday after a volatile session in the early trade as early cash market quotes were only steady with last week at $138 in both southern and northern markets. Improving box prices with choice up $1.63 and select gaining $1.35 increased to cash trade for improvement into the latter part of the week.
Yesterday’s March Cold Storage report showed end of February beef stocks were 1% higher than January at 533 Mil pounds and were 5% more than a year ago. However, the February increase was the smallest in seven months, and a seasonal top in stocks is forecasted for March.