Turnaround-Tuesday has yet to make its presence.

The grain trade is lower again this morning after mild strength in the overnight session from the reduction in crop ratings, which were mostly expected. Morning grain pressure persists on ridge-riding storm systems and cooler Midwest temperatures. Friday’s USDA report keeps fears of bearish USDA crop data in place, a typical norm. Meanwhile, July temperatures are forecast to be hot, with drought developing across the Delta/Southern Midwest and the Ohio Valley, which could create a dramatic turn if it does not dissipate from longer-term forecasting models.

Basis improvement continues in some key areas as spreads suggest old-crop corn and soybean stocks may not be as plentiful as feared. Questions are again being raised about last year’s corn and soybean crop sizes, which highlight possible miscalculations by the NASS on their record US corn weight.

Crop consultant Dr. Michael Cordonnier says a half million to one million corn acres might be lost due to the excessively wet conditions and flooding in the northwestern Corn Belt. Those acres will be counted as planted but reflected in a lower harvested acreage percentage, which he believes will be 90.3% to 90.7% this year, down from an average of 91.3%. He says planting soybeans in late June or early July in the northwestern Corn Belt would be “a risky proposition,” as they would flower while the crop is in early development, “resulting in short-stature soybeans with a low yield potential.” Cordonnier left his corn and soybean production forecasts at 14.62 billion bu. and 4.46 billion bu., respectively.

As expected, crop ratings fell yesterday by 3% due to hot/dry weather in the E Midwest and excessive wet weather in the NW Midwest and N Plains last week. The decline in condition was in line with trade expectations.

NOAA issued a warning for a new round of heat in early July for the S Midwest, Delta, and E US, with a rapid onset of drought across the E Midwest and Eastern US. Ridge-riding storms will produce needed rain across the NC and any Midwest, while the NW Midwest struggles with more unwanted rain, which will continue to make new rounds of flooding. Weather forecasts are not as perfect as the grain trade, which is trading to achieve a record 181 BPA and corn nationally.

Egypt's August-September tender for wheat received 36 offers, with the cheapest price being $227/MT FOB for Kazkh wheat. Russian offers were $228/MT, which shows that sellers are now decoupling from Russia’s prior Ag Minister cents selling price.

It was a mostly higher day after a lower start on Monday for cattle futures that absorbed the weakness on the opening from the bearish placement data. Cash markets are not expected to trade until Wednesday or later, with early week strength having feeders looking to sell higher prices again this week. Weekly beef imports were lower last week but remain historically high at 59 million pounds. The beef import rate is below the first-quarter highs but continues at a record pace. The weekly data shows cumulative imports at 1,483 million pounds, up 19% from last year, which is the largest since USDA began reporting the data in 2013. Australian imports have accounted for 63% of this year’s growth.

June cattle are getting ready for expiration at the end of the week, while August trails at a $4 discount. August cattle reached their initial resistance on Monday, while key support is still just under 180. USDA will detail frozen meat stocks at the end of May. The five-year average is a 30.4-million-lb. decline in beef stocks and a 30.7-million-lb. drop in pork stocks during the month.