Soybeans lead overnight recovery ambitions.

Grains are mostly firmer today, with soybeans leading the recovery bounce. Export sales numbers this morning were very strong, with corn at 1.66 million metric tons, while soybeans came in at 376,700 metric tons. Statistics Canada released their Canadian grain stocks as of March 31. They reported wheat stocks at 15.421 million metric tons, compared to an estimate of 13.2 million, canola at 5.869 million against estimates of 5.3 million, and oat stocks very close to estimates at 1.283 million, as the estimate was 1.3 million metric tons.

President Trump is expected to announce a trade deal with the United Kingdom. Although the United States does not have a trade surplus with the UK, tariffs are being neutralized for automotive and other products. The UK is not a major agricultural trader with the US, but many are watching to see the structure of this deal to understand how future agreements might look. Meanwhile, the US Trade Ambassador and the Treasury Secretary will begin discussions with China this Saturday in Geneva. No one knows what will be on the agenda from either side. Since not much is expected to come from this meeting, there is always the possibility of a surprise positive announcement on Sunday, which could impact the Sunday night markets ahead of the WASDE crop report, scheduled for release at 11:00 a.m. Central Time.

Global geopolitical tensions continue to rise between India and Pakistan, as they carry out cross-border drone and missile strikes. This has sparked fears that the conflict could escalate into a regional war not seen since 1971. India could soon become a buyer of US wheat in the near future.

Following the announcement that China’s Henan Province has been suffering from drought, weather forecasters now predict that the winter wheat areas are becoming even drier, despite the potential for a few scattered showers over the next 36 hours. This dry spell is harming yield potential by as much as 40 to 50 percent, and even irrigated fields are expected to face significant losses. This situation could make China a larger wheat importer in the 2025-2026 crop year balance sheets.

Dry weather remains in the forecast for the Central United States over the next seven to ten days. The forecast is drier than yesterday’s and raises questions about rainfall totals over the two-week period. A troughing and ridging pattern is expected to form a week from today across the Central US, which typically produces showers at this time of year. The GFS model shows flooding rains in portions of Illinois and Indiana within the two-week forecast. However, the Plains and Western Midwest appear set to remain drier, with rainfall continuing to run below seasonal averages. The area stretching from Nebraska north into central Canada is at risk of rapidly drying soils.

Live and feeder cattle futures experienced a corrective day on Wednesday, with losses at one point reaching as much as three dollars, though these were reduced to one-third by the close. Meanwhile, negotiated fed cattle trade remained light, with some sales in the South reported steady to $3.00 higher than last week at 218 to 221 dollars. Sales in the North were quoted at 352 to 355 dollars, representing an increase of $3.00-6.00 on a dressed basis. These are all record-high prices.

March trade data showed the average retail beef price is eight percent higher than a year ago, reaching a record $8.75 per pound, while domestic consumption was up nine percent. Based on rising consumption prices, domestic demand in March appears to be 13 percent higher than last year, marking the eighth consecutive month of rising domestic demand. Unless consumer demand softens or we experience some form of Black Swan event, a major correction in cattle futures looks unlikely due to the already significant discounts to cash. Significant setbacks are expected to remain supported.