Soybean oil leads the strength in the overnight grain trade.

Stability came to the grain trade overnight with soybean oil leading to soybean gains of 7-8 cents as Pres. Trump has asked the US oil and biofuel industry to work together and craft a new biofuel regulatory proposal they can both endorse. This would avoid the battles endured in the initial Trump administration. Two meetings have reportedly been held so far, but no agreement. The US biofuel industry is seeking to raise the RVO for green diesel to 4.75-5.5 billion gallons versus 3.35 billion gallons as it stands today. This would utilize a larger share of capacity. There is no agreement on 45Z or coming green diesel subsidies with ethanol, to be held at 15 billion gallons due to stagnant gas demand.

Gold is sharply higher this morning as Pres. Trump placed 25% tariffs on any light truck or auto not produced in the US. The Dow has recovered from overnight losses, while gold is now trading at $ 3,094 an ounce, and crude oil futures remain steady. The Trump auto tariffs can be stacked with traders discussing the impact of building a new auto plant, which takes anywhere from 3 to 4 years. Until then, some of the tariffs will be passed to US consumers. Increasingly, consumer confidence is falling due to tariffs in the US and other affected nations, which slows economic growth and raises inflation. That is what we call stagflation.

The hearing yesterday on the China port vessel tax had the ag industry on the offensive with congressional and 10 days on how it will be disastrous for exports, raising consumer prices and harming efforts to rebuild manufacturing in the US. The US ag industry is pushing back on the proposal as it takes US shipyards 3-5 years to build out US vessel fleets to even make a dent on the taxes.

Russia is seeking a negotiated new ceasefire for Black Sea ocean transit, with details of other demands still unknown. It remains obvious that a ceasefire between Russia and Ukraine on land is a way off, and the world will continue in the weeks and months to come. As of this week, the grain trade is treating it as a done deal, assuming the war is over. Premiums extracted may be reapplied in the coming weeks.

Soaking rains will fall across the Delta and the southern Midwest in the coming days, while any rains in the Plains will remain light and under .25″. Spotty rains are seen for the Black Sea through mid-April, with forecasted rains for next week being reduced in size and scope. Black Sea temperatures are expected to average 4-6° above normal through April 6.

Live and feeder cattle futures quietly worked higher yesterday as a recovery from the three days of heavy selling that occurred since last Friday. Meanwhile, the cash feeder Index was off $0.35 at $286.90, with March feeders trading just a dime under the index under today’s expiration. This week, the nearby feeders/fat spread rose to a record high of $80/CWT feeder cattle premium. Deferred spreads are even higher, with the August feeder/August fat spread at a $90 feeder cattle premium. Tighter feeder cattle supplies keep prices elevated, suggesting that deferred live cattle futures are too cheap.

Negotiated fed cattle markets are still quiet through midweek, with light sales having been reported on Tuesday. Continued strength in the beef market supports the idea of higher cash trade this week, with asking prices in the South quoted $2 higher than last week at $212. Box beef values were hired midweek, with Choice picking up $3.11 yesterday, which puts them up $12.85 for the week. Select values have gained to $2.48. June cattle have resistance at 205-206, while May feeder cattle have a similar recovery resistance at 287.50-288.50.