Wheat jumps on Russian wheat hold rumors
This morning, grain prices are finding wheat sharply higher on a story out of Reuters that Russia is contemplating a halt of wheat and sunflower exports due to the recent price collapse. It’s a rumored story from a meeting with high-level members held in the Russian Ag ministry. This has prompted Kansas City wheat to head back towards the highs of the week, allowing it to refocus on the drought in HRW wheat belt and helping lift corn, as Chicago wheat finds its own strength, widening the spread, which had reached just under $0.30 a bushel for Chicago wheat over corn this week. If the halt occurs, it’s not anticipated to be a long period of time, as Russia needs the hard currency do to the ongoing war. Russia is likely trying to stabilize wheat prices ahead of the Spring wheat planting campaign.
Soybean futures continued their liquidation from index funds exiting their massive length en masse. As Brazil owns the export market, the Argentine crop shortfalls have been overrun with the feast versus famine effect. Yesterday’s export sales showed an almost pause in exports compared to the extensive sales of corn over the prior week.
Outside markets again are creating difficulty, with Deutsche Bank out of Europe rumored to have difficulties, which sent stock indexes and energy markets sharply lower overnight, with metal prices alongside bonds pressing higher on another flight to quality.
The weather forecast and Argentina shows more rain again and occur through Tuesday of next week with totals of .5-2.00”. The rains will help restore soil moisture which can aid the corn crop. Dry weather is occurring in Brazil, with showers there also returning this weekend.
Cattle futures were softer yesterday as cash trade continued to move steady with early week activity at $163. This is $1.00 weaker than last week’s trade. Boxed beef values yesterday were mixed with choice higher by $1.48 with select down $0.93.
Yesterday’s March Cold Storage reported a sharp drop in end of the month February beef stocks. Total stocks were reported at just over 500 mill pounds, a 6% drop in January. This is the largest one-month decline since May 2021. Beef production fell 10% from January and was 7% lighter than a year ago. Total cattle slaughtered were down 10% and 5% less than a year ago, with the beef cow kill dropping to a two-year low. When adjusted for the fewer days in February, the beef cow kill was the smallest since April 2021. Beef cow herd liquidation has likely come to an end, and the reduced slaughter will lower domestic lean beef supplies.