China canceled soybean auction.

This morning’s grain trade has wheat on the defensive challenging multi-week lows, while soybean futures recovered higher overnight, as China had canceled the auction planned that was going to roll out 2 MMT of imported soybeans, citing technical issues. On Friday soybeans had stumbled after the friendly news for soybeans production was released, a Financial Times article released almost simultaneously indicating Trump was going to bring back Robert Lighthizer to head trade sent the markets lower again. Lighthizer is a well-known protectionist and China hawk whose presence would make some recent talks about a more measured approach to trade negotiations and tariff rollbacks far more difficult to see. The rumors were dispelled the following day, though, with many saying Lighthizer would be a better fit for commerce.

Of course, who President-Elect Trump decides to surround himself with this time around will have a great influence on how he tackles trade, biofuels, and other important policies and will be the biggest focus this week and in the weeks ahead. His choice for Chief of Staff, Susie Wiles is the first female to hold the position and is said to be incredibly respected across both sides of the aisle. According to analysts, her presence may make a noticeable difference in how this administration approaches many of Trump's promises during the campaign.

We will likely get more clarity this week, not only on who will make up the Trump cabinet but also on how he intends to tackle some of the major geopolitical conflicts we are watching. Drone attacks by Russia on Ukraine and by Ukraine on Russia were at the highest level seen since the start of the invasion over the weekend, with experts anticipating an escalation by both parties to be seen over the next few weeks.

Looking ahead, we look to turn some more unknowns into knowns this week, with the talk that we could see the Biofuel Blender Credit extended for another year. The tax credit helped biodiesel, and renewable diesel producers subsidize their margins during the growth stage, with the 45z tax credit set to take over. However, the lack of rules from the Biden administration had opened the door to lower demand as margins collapsed.

Senator Grassley said late Friday the credit had been added to a bill full of other tax credits that needed to pass, likely allowing for its continuance until rules on 45z are established. Wheat prices were lower overnight despite steady trade in French milling wheat, as the rains in the driest area of the winter wheat crop received rain. Conditions there continue to improve, and the winter wheat crop ratings are now expected to rise another 1-2 points in this week’s progress report, which is delayed until tomorrow with Veterans Day today.

In South America, the weather remains favorable for Brazil, while Argentina's weather will be watched going into December. The 30-day forecast today features only limited coverage of dryness in Argentina, but La Niña development remains are paused for now. This keeps any major drought development in Argentina to be watched into early 2025.

The live and feeder cattle trade produced another lower week with a softer outlook for this morning’s early trade. Friday’s gap lower from Thursday’s $6.00 loss in box beef and the lack of recovery has the market in a technical downtrend again. The negotiated fed cattle last week was lower in all regions, with live trade in the north at a wide range of $185-188, which was $2-5 lower, while dressed sales range from $290-298. Live trade in the South was off $3 at $187.

Box beef saw choice decline $8.41 to $307.93 last week, while select gave up $5.84 and was the lowest since last January at $279.19. Estimated slaughter margins were a little weaker but still positive at $108/head. The commitment of traders report shows funds still heavily long as they had only liquidated 731 contracts through last Tuesday, yet the December contract was off $three from Tuesday through Tuesday. Friday’s gap down on the December live cattle chart leaves major resistance now at 185-185.50.