WASDE crop report Friday.
Grains are lower across the board this morning, led by soybeans that appear to be ready for another leg down with bearish news anticipated this Friday from the WASDE crop report. Also export sales this morning were minimal as anticipated. Argentina lowered its soybean production to 21.5 MMTs and lowered corn to 32 MMTs. While Brazil increased production from 153.63 MMTs to 154.81 MMTs, with corn also increased from 124.44 MMTs to 125.54 MMTs.
Negotiations to maintain the Black Sea Grain corridor of 3 Ukrainian ports open beyond May 18 continue behind the scenes. The market seems to have already embraced the fact that it will be closed as alternate sourcing has already but underway. The Turkish presidential election is this weekend, May 18, and the current president is sympathetic to Russia and is trying to push for the extension negotiations now. He is in a close battle with his opponent Kemal Kilicdaroglu who is not anticipated to be a helpful influence for Russia from Turkey. Russia said today that Putin could speak with Turkey’s President Erdogan on short notice if needed regarding the Black Sea grain pact. There is a sense of growing optimism that an extension of the agreement may be achieved.
During a press conference, a director of China’s National Food and Strategic Reserve administration said the country will continue to work to stabilize and diversify its soybean imports, considering new soybean markets.
May WASDE Report Friday tomorrow at 11:00 a.m., new crop balance sheets will be included, as well as production estimates. The forecast for the Central US maintains an active weather pattern through the weekend, with showers occurring on a near daily basis in a zonal flowing jet stream. Summer like warmth will spread, helping germinate the 2023 crop. Any 90-degree heat will be focused on the S Plains. North Dakota seeding will and later today, with rains starting in totals of 1.50-3.00” falling through the weekend. The midsection of the Central US holds a drier trend, with topsoil moisture becoming short in KS/MO/IA.
Live and feeder cattle prices were lower yesterday, with a steady outlook anticipated this morning. Cash trade was slow on Wednesday, with some sales quoted at $170 in the southern plains, two dollars lower from last week. Elsewhere in the Plains, feedlots passed on packer bids of $177 live in $275 dressed. Cattle slaughter at midweek is now 380,000 head, up 4000 head from last week and 15,000 head more than a year ago. The elevated cattle slaughter has weighed on beef prices this week, and cutout values were lower on Wednesday. Choice slipped $0.51, while Select was off $0.35. June live cattle continued to congest with yesterday’s recent test of the better levels and rejection, now opening the door for the lower support region to be challenged near the 161.00-161.50 range.