Soybeans hit with deliveries

Grain futures are lower across the board this morning, with soybeans tumbling from the start as deliveries as 411 contracts were tendered against the March contract from Cargill. In addition, there were 8 contracts of soybean oil and 352 contracts of corn. Kansas City wheat found 245 contracts delivered, with 911 contracts for Chicago and Dreyfus delivering 611 of the Chicago wheat. No soybean meal was registered or tendered for delivery.

Kansas State crop reports indicated that 51% of the HRW wheat crop was rated poor or very poor in yesterday afternoon’s updates. Additionally, 60% of Kansas topsoil moisture was rated short or very short. There is the likelihood of some abandoned acreage that could occur due to such a large percentage of very poor ratings.

The new corridor negotiations start late this week, and the new sanctions placed upon Russia by US/EU last Thursday will not help Russian grain exporters as they target the biggest banks providing export financing and Russia’s second-largest coaster fleet in the Azov Sea. These new NATO member sanctions will have an adverse impact on Russia’s grain export capabilities and could cause a complication in the extension of the Grain Export Pact renewal. The recent grain selloff may find a bid as negotiations take place in the next week and Russia pushes back.

Dry weather dominates Argentina from yesterday into today, while some scattered showers are possible Wednesday/Thursday that should be widely scattered and amount to .1-.8”. Any rainfall of more than .50 looks to be 15% coverage. After that, below-normal rainfall and hot weather trends return across Argentina further following 7-8 days. The 11-15 day forecast offers a return of showers but, again, will be under 1 inch.

Cattle futures on Monday were mixed to weaker while feeder cattle maintained a slightly higher pricing on the weak corn. The COF report was friendly as anticipated and could not inspire new ownership for the time being at elevated levels. Active trade this week is expected to hold off until Thursday/Friday, with the outlook being no worse than steady, while feedlots in the South anticipate $1-3 higher. Box beef had choice gaining $1.06, while select jumped $2.17. The choice/select spread continues to correct due to a record large 75% of the cattle having graded choice in 2023. The spread has moved from $27 in early January to just $9 this week. Cattle futures trade firm but labored, with cash dictating strength.