Corn leads overnight recovery strength.

This morning’s grain trade is mixed after a lower start overnight. Strength in corn has the spot March contract challenging $5.00, throwing support to the soybean and wheat market as Friday’s highs come back into focus. Corn cash basis in the Eastern Midwest firmed late last week, with the Central Illinois corn bid being two cents over. Even though South American crop harvest pressure weighs on soybeans, the soybean trade finds strength in a firming soybean oil trade and soybean meal, which is found to be stable at just below $300.

Saudi Arabia reportedly purchased 920,000 MTs of optional origin wheat in mid-July. The tender is a glimpse at new crop position pricing, with exporters willing to discount the late June to mid-July timeslot to $275-276/MT. The average Saudi wheat sale price on a CIF basis was $276.25/MT. There is no formal Russian FOB wheat offers beyond May and $250/MT, but others appear willing to sell June-July wheat and $245-248/FOB.

NOPA will report the January soybean crush report today at 11:00 a.m. CT. The total crush is projected to be at a record high of 205 Million Bu. Member soyoil stocks are forecasted at 1,310 million pounds, which is slightly higher than in December.

The South American weather pattern remains favorable, with soybean harvest in full swing and the seeding of winter corn accelerating. Mato Grosso indicated that they harvested 50% of the soybean crop and planted 45% of their winter corn crop, almost a week behind the five-year average. Amid favorable dry weather, Mato Grosso's soybean harvest is anticipated to reach nearly 70% by Friday, providing soybean crushers with almost 30 MMTs of soybeans for crushers/exporters.

Fund liquidation continued to weigh heavily on cattle prices last week, as April live cattle fell below the 50-day MA on Friday. March feeders also dropped lower on Friday but finished the week with modest gains, while the cash feeder Index slipped to a five-week low before finishing slightly higher. The negotiated fed cattle trade during the week was lower in all regions. Dressed trade in the north was down $4-6 at $320-322. Live sales were $4 lower at $203. Live trade in the South was $3-4 lower at $202-203. The north/south spread fell to even money, the narrowest since November.

Box beef values also fell sharply, dragging the estimated slaughter margins deeper into the red. The choice cutout was off $7 and select was almost $6 lower. Negative kill margins are expected to pull cattle prices lower. Meanwhile, the COT report showed that for the week ending February 11, funds sold 14,006 and 65 contracts against commercial buying of 10,516. This was the most significant week of fund selling since early August.