Grain trade mixed ahead of today's crop report.

This morning wheat and corn are lower on the session while soybeans maintain strength in the overnight trade ahead of today’s NASS and WASDE crop report at 11 AM CT. Adjustments are anticipated to South American crops along with downward US corn and soybean exports which are anticipating a carryout increase across all three grains. Midday weather models come out at 11 AM, so we will have the heightened volatility of viewing the data along with tending to the ever-changing weather forecast. Overnight, the euro model backed off from some of its rain calculations along with this morning’s GFS still showing rain but not increasing anything from its latest expectations.

It appears the Black Sea Grain Export corridor could come to an end in July, as the meeting in Geneva had the Russian ambassador to Turkey suggesting there are no grounds to extend the grain deal. Also, Russia’s Ag Ministry lowered their corn and wheat export taxes for the period ending June 20th.

Argentina’s soybean harvest is nearing its end (94% complete), with total production expected to be just 21 MMT. Argentina is the world's largest exporter of processed beans.

Yesterday’s recovery bounce in wheat was tied to Russian officials rejecting the sale of wheat done at $229 MTs, as they are trying to hold fast to the $240 MT minimum requirement. According to a senior Egyptian official, the country may not achieve its wheat procurement target of 4 MMT for the season. Egypt has been trying to increase domestic wheat procurement to reduce import costs.

As we head into the weekend, we find the battle of weather models again, with the GFS always finding a wetter solution than the EU model. The EU model now has been flipping back and forth on rainfall amounts in its own 10-day forecast after typically staying dry. As of this morning, the EU model offers limited rain for MN, IL, IN, and OH. IA and MO have better rain chances along with US Delta and Gulf Coast. Meanwhile, the GFS model offers a wetter solution for the Central US weather of the Midwest with chances of 1.00 rains arriving into Eastern IA, most of IL, IN, and OH into next weekend.

Yesterday cattle and feeder cattle futures traded two-sided and ended lower on the session for the second day in a row since Wednesday’s volatile swing from sharply higher action to a sharply lower close. If live and feeder cattle values do not recover in price today, the August live cattle forward and feeder cattle would put in weekly reversals, meaning after new highs this week and closing lower than last Friday sets up a technical reversal implying a top on futures contracts. If, in fact, the market has put in a top and we do break into a further correction, feeder cattle are the ones that could struggle the most, as August feeder cattle are $16 over the cash index, with November carrying a $22 premium.