The grain trade starts Turnaround-Tuesday mixed.

This morning’s grain trade is mostly mixed as we await the June WASDE crop report out Wednesday at 11:00 a.m. The big focus is going to be the US when wheat production, with traders anticipating increases, will also move right into carryout numbers as a favorable May weather forecast is producing a large 2024 winter wheat crop. This is much different than the Black Sea supply focus, which was the flavor of May, as it will take the month of June to wrap up harvest pressure against the board.

The break in world wheat prices in two weeks has prompted the second largest importer back into tendering for August wheat imports. Egypt is tendering for August FOB wheat with payment on site, which is different from the prior tenders. There were 39 offers of August FOB wheat to Egypt, with Russian wheat offered at $265 in early August and $270/MT for late August. The cheapest offers were from Ukraine and $243-245/MT FOB, while Eastern European wheat was at $251-258/MT. It appears that Russia will lose out again on another Egyptian tender as it holds to a higher price range. Russia did comment overnight that season export opportunity to China/India to supplant their lost Turkish demand. Overnight Paris wheat futures rallied on the prospects that Europe may capture some of the tender with Russia out of the game.

A hot US Midwest forecast is on the way in the next 48 hours. The upper 80s to upper 90s will become commonplace across the Central US as a high-pressure Ridge holds across the region. Rainfall will come from Ridge-riding storm systems that favor the N Plains and the NW Midwest. Look for acute dryness across the C and S Midwest/Delta into late June. Due to the excessive Central US heat, US crop ratings will start to slide in the weeks ahead. As of this past Sunday, the US corn crop is rated 74% good excellent with initial soybean rating coming out of 72% and spring wheat also at 72% good/excellent.

The June WASDE crop report is tomorrow, while Brazil’s CONAB will be on Thursday. After these data numbers are released, traders will focus solely on Central US and world weather modeling for production. Of note is that Western Midwest cash corn basis bids are strong, with Cedar Rapids now trading at $0.20 over July. The central US high-pressure Ridge will likely garner attention amid the heat. Because of this, it will be difficult to sustain any declines in row crop pricing into late June. With July weather being completely unknown and long-range forecast models arguing for a hot Central US summer, volatility is about to pick up.

In the Central US forecast, above to much above-normal temperatures with below-normal rainfall are offered, which will initially favor crop growth in the root down. If the heat/dryness does not last beyond late June, it won’t be a problem. But Midwest US high temperatures will routinely reach the upper 80s to upper 90s now through June 24.

Live cattle and feeder cattle futures burst higher on Monday, with a firm start anticipated this morning. Feeder cattle futures paced Monday’s rally and almost gain $4 died 00 on the close. The cash index jumped $168 for the start of the week at $252.88. The cash feeder Index is $1.22 away from the record high that was marked last September. Meanwhile cash markets are their usual quiet to start the week, but the rally on the board will have feedlots looking to sell higher later this week. Last week Packers bought 64,120 head on a negotiated basis with 52,096 head for 1-14 day delivery and 12,024 head for 15-30 day delivery. Negotiated fee cattle purchase volume was the highest since late March and well below the five-year average.

Box beef values were mixed to start the week. Choice gained $0.67 to $317.42 and is now trading at the highest price since late August. Meanwhile, the select slipped a dime to $301.04. In the delivery process, June cattle are looking to test the early-year highs near $186 ahead of expiration. This should help support the rest of the board until other unknown demand-slowing stories can be thrown at the market.