HRW wheat ratings declined with more losses anticipated this week.

Grain futures have wheat and soybeans gaining this morning, along with gold making new all-time highs to 3040 as the US dollar stays near one 03. Kansas City wheat ratings declined, with the good/excellent ratings falling 4% to 48% from the prior week, while Texas ratings held steady at 28% and Oklahoma at 46% for the same category. The plains weather forecast remains warm and dry, with win episodes producing blowing dust for the next two weeks. US HRW wheat conditions will decline further amid hot, dry weather next week.

Brazilian soybean prices are rising via FOB premiums along with corn prices, which have also been rising sharply amid shortages as their first 24 MMT corn crop is being harvested. Seasonally, the Brazilian corn market is forecasted to peak in the next 2-3 weeks amid greater supplies across Southern Brazil from their advancing harvest. Brazil keeps most of its first corn crop for domestic use. Brazil is proposing to increase the mixture of ethanol in its gasoline supply to E 30 from 827.5, which would add 2.875 MMTs to the domestic corn demand. No exact date has been set for the start has been decided. The Brazilian government has recently held its lending rate of soy oil into biodiesel at 14% rather than boosting it to 15% this year as proposed due to the fear of inflationary price pressures. A government decision could wait until late 2025.

Wheat is the new bullish story for the grain exchange, as adverse weather threats are not only here in the US but also in the Black Sea region, Eastern Europe, and India. The heavy index short position is at risk of further short covering, similar to what corn experienced late last fall/early winter. Their buying could set up the prospect of wheat taking out the highs made in February and offering pricing opportunities for old and new crops.

Above-normal temperatures across the Plains are drying soil moisture, with limited precipitation forecasted across the Plains and Southern US through the end of March. Dryness persists across Ukraine into Western Russia, putting their winter crops at risk, with above-normal temperatures persisting across Europe and central Russia.

Live and feeder cattle burst higher late in the session on Monday, with feeder cattle all closing at new contract highs. April live cattle closed above $ 205, marking the second-highest contract close. The cash cattle market cents have a higher tone this week, especially the choice cutout, which jumps $2.89 on Monday, with a select up $1.58.

Last week, the Packers bought 81,521 head on a negotiated basis. 73,981 were for 1-14 day delivery, and 7,540 were for 15-30 day delivery. Cumulative negotiated purchases this year stand at seven 63,694 head, down 2% from a year ago and the lowest since reporting began in 2003. Negotiated beef cattle purchases account for 17.2% of all purchases. In 2015, 21% of cattle bought were on a negotiated basis, and 2005 it was 55%. The cattle business is headed the way of the hog industry, where just 2-4% of the animals are sold on a negotiated basis.