Soybeans push a new fall high overnight.

The grain trade had follow-through buying overnight, with short covering for corn and wheat while soybeans were able to push another new fall high. CONAB (Brazil’s version of the USDA) estimated their 2023 Brazilian soybean crop at 153.5 MMTs, which was down slightly from their November estimate as they trimmed the soybean yields in the Goias state. Due to strong margins, some expect that the acreage area will grow into the January report. This continues to elevate prospects that the Brazilian crop could be well over 155 MMTs.

The soybean oil has collapsed over the past week by nearly 20% due to the updated EPA RVO mandates for 2023 through 2025. This disappointment has crashed the spread of the soybean oil aspect of it to a two-year low on the crush. Meanwhile, concerns about a rising drought in Argentina, an exporter of soybean meal, continue to add pressure to the upside of the unwinding of the crush spread with the sharp vaulting price in the meal. Soybean oil has now fallen to values that will continue investment in renewable diesel refineries, and strong support should arrive on the spot bean oil contract near or slightly under 60.00.

The South American forecast shows Brazil continuing to receive near to above-normal rainfall across the northern and central crop regions, with near-normal rain now across Southern Brazil. Temperatures hold near to below normal levels, with any heat focused in the far Southern Brazil region of RGDS. Argentina was hot again yesterday, with highs reaching the low 90s to lower 100s, with showers developing overnight in the northern areas. Additional showers have a chance to occur today through the weekend with totals of .25-1.50”, with the heaviest rains favoring eastern Argentina. Brazil’s avoiding any lasting heat or dryness causes conditions to remain highly favorable for Brazil and Paraguay.

After a lower run yesterday, live cattle firmed to the better levels of the day while feeder cattle still closed lower. The cash feeder Index gained $0.49 to $179.02. There was some light demand showing up on Wednesday for the negotiated fed cattle, with Nebraska $1 lower at $156 on a live basis and $2 lower on a dressed bases at $247. Markets and other regions had limited trade which leaves significant amounts of business left to develop this week. The cattle slaughtered midweek totaled 382,000, down 2000 from last week and 17,000 from last year. The box beef market yesterday recaptured most of the early week losses, with choice regaining $6.31 and select up $0.63.