The Black Sea corridor is operational again.

Good morning to another headline day, when at 5:00 a.m., the wheels came off the grain rally as Russia announced it would resume participation in the Black Sea export corridor. It’s reported that Russia’s Defense Ministry received a written guarantee from Ukraine stating the corridor would not be used for military operations against Russia, which is sufficient for Russia, and there is talk that vessel navigation will be back underway midday Wednesday.

It’s essential that the Black Sea exports can continue this autumn into the winter, and close attention will be paid to the weekly/monthly movement of shipments to ascertain if the corridor is fully operational or not. Putin seems to have a changeable position on the corridor, which can work for Russia’s price advantage, implying he has a political grip on global wheat values in the near term.

Malaysian palm oil continued its rally overnight and was up 150 ringgits to a new 10-week high overnight. This is supporting soybean oil this morning which is the only commodity still higher after the resumption of the safe grain corridor operations. Crude oil is higher ahead of the Federal Reserve interest rate hike at 1:00 p.m., with the US dollar presently slightly lower on the session. Asian palm production during the winter months is on retreat, which is supportive for late December/early January.

The EU and GFS models for weather show coverage in the intensity of weekend rainfall across the Plains and Midwest that can produce heavy accumulations of precipitation of 1-2”, which favor the far eastern plains. This will miss the heart of the HRW belt but hit AR, MO, IA, and WI. The South American forecast is drier in Argentina in the 6-10 day period, with Brazilian dryness now extended into November 11-12. Abnormal dryness across tropical latitudes in Brazil is not yet worrisome as soybean seeding will be ongoing for another 2-3 weeks, but close attention will be paid to exactly when a more normal pattern of rainfall resumes.

Live and feeder cattle were lower on Tuesday, with a softer start anticipated this morning. December live cattle could not recover early week losses which have follow-through selling possible with the new round of fund ownership that came in last week. Negotiated fed cattle is still quiet through Tuesday, with feedlots looking to add another $1-3 to last week’s prices. Box beef values were lower, with choice down $102 and select slipping $1.73. Live cattle prices typically flounder in November after a late September/October low. Trends turn seasonally higher after Pearl Harbor Day, December 7, with strong up seasonal tendencies a carry into the opening of the New Year.