Soybeans lead overnight grain trade advance.

This morning’s grain trade is firm, with follow-through buying from yesterday’s strong closes, led by soybeans. A strong overnight recovery in the stock market, with the Dow Jones gaining over 1,000 points, is also providing support.

Soybeans are leading the strength as an Argentine crusher, representing 9% of the country’s total capacity, has shut down—at least temporarily, following bankruptcy and an inability to pay workers or source supplies. The company, Vincent, is facing financial troubles with no clear timeline for resuming operations, having also struggled with labor strikes back in February.

Additionally, Brazilian soybean FOB premium shave triggered speculative short-covering in soybeans and meal. Brazilian soybeans for July–August delivery are quoted at $418/MT, which is $25/MT higher than U.S. Gulf origin. Brazilian corn FOB premiums are slightly weaker but still well above U.S. basis levels for July–August.

Yesterday’s NASS first winter wheat rating presents a mixed outlook. The national good/excellent rating of 40% leaves the potential for either below- or above-trend yields. Concerns are increasing due to excessive moisture in the mid-South and persistent dryness in the southern and central Plains. The overnight GFS model added rain to Oklahoma and Kansas for April 17–18, but it is currently the only model showing this wetter forecast. Other models continue to show a pattern of soil moisture loss through April 23. Temperatures are expected to reach the 80s and 90s starting next week.

Another area of concern is the drought, which must ease significantly across the Central Plains, Iowa, and Minnesota before June to preserve the projected corn yield potential of 182 bushels per acre and soybean potential of 52–53. A lack of old crop carryover and the need for large 2025 crops could drive markets significantly higher if dryness persists into June, similar to 2012 when large acreage was planted but corn prices surged in the summer. In the absence of strong demand drivers, particularly amid trade tariffs, the weather will become the dominant market factor heading into late spring.

Live and feeder cattle futures closed sharply lower again yesterday, but a firmer to higher open is expected this morning due to the strong recovery in the stock market. The cash feeder index fell $1.95 to $290, and further correction is likely this week. CME feeder cattle are trading at record discounts to the cash index across the board. April feeders, expiring next Thursday, are at a $12 discount to the cash index. Historically, April expirations have not deviated more than $5 from the index. Typically, August through March contracts in early April trade at a $5–$15 premium to the cash index.

Last week’s Commitment of Traders report showed funds held a near-record net long position in feeder cattle, over 33,000 contracts. The massive liquidation of these positions has pushed board prices well below fundamental value. May feeders have bounced off support in our projected zone of 266–271, with a low scored in the middle of that range. A continued failure to find support near yesterday’s lows could open the door for a deeper break to long-term weekly support at 259-259.