Europe applies tariffs, turning corn and beans lower overnight.

This morning’s grain trade is lower after yesterday’s WASDE report failed to lower corn carryout close to 1.5 Bil when many were expecting they would increase the grind by 25 Mil Bu and also boost exports. Instead, the USDA chose to kick the can down the road and wait to see if there is any file out from the current trade war implications.

Overnight the EU tariff list was applied to US goods, and it did include agricultural items of soybean, corn, a limited amount of spring wheat, along with beef. Most of the beans that EU crushers have bought from the US have mostly been exported but it’s estimated that some 400-600,000 MTs of EU bean purchases are carried in the unknown destination category. It’s unknown whether traders will see those beans shipped before the EU cut-off dates.

There are talks in the work that Pres. Trump and Pres. Xi of China will possibly have talks in April in an upcoming summit meeting. It’s hoped that a cooling effect and dialogue will be created.

In Argentina, the soybean processor Vincentin is enduring a labor strike which occurs nearly every year. How long the strike typically lasts and impacts soybean product exports is not known. There are 1.2 MMTs of soybean meal lineup that Argentina is not able to move at the moment. However other Argentine crushers can make up the difference in the short-term which creates a muted impact on the market. How long the strike typically persists for a few days or even a week. If the strike does occur longer than the normal annual strike that takes place this time of year, with then impacts total exports and has a price effect.

This morning CPI data was friendly as it showed month-over-month inflation coming in at .2% versus an estimate of .3%, along with year-over-year inflation up 2.8% versus an estimate of 2.9%. This has supported the stock market this morning along with energies and metal prices with grains mostly unaffected.

In Brazil over the Eastern and Northern portions that have been dry will remain dry for another 5-7 days. Combined high temperatures of 90’s to lower 100s or deepening the drought that is affecting late planted soybeans and 30% of the Brazilian winter corn crop. Rains are hoped to occur in longer-term models, but they always remain beyond the 7-day outlook.

The rain outlook for the southern plains remains elusive with no precipitation forecasted through Saturday, March 22. The Eastern Europe and Black Sea forecast also remains mostly dry with only the southern portions of the Russian wheat crop picking up chances of rainfall in the late 10-day model.

Live and feeder cattle futures had pushed higher Tuesday morning, challenging resistance points, including feeder cattle it pushed through major resistance at 279-280 but closed substantially below those levels. This morning’s outlook is uncertain with the European beef tariffs applied to the US, meanwhile, the stock market is in recovery mode. Cash-negotiated trading interest should start to develop later today and be more active by Thursday. Box beef values yesterday had choice jumping $3.62 and is up $6.30 on the week at $3 21.20.

In yesterday’s March WASDE report the estimated second-quarter beef production at 6,735 million pounds, down less than 1% from 2024, and third-quarter production would be down just 1% at 6,715 million pounds. The Q3 average price forecast was $198 versus the CME cash equivalent this week of $193. Historically the March WASDE overestimates the third quarter price but has been too low for the last four years by an average of $15. Cattle futures likely scored a short-term technical high and are now due for a correction. April cattle have major support at 196.00-196.50 while June cattle have support at 192.00-193.00.