Soybeans lead the overnight grain recovery.

Soybeans are sharply higher again this morning for the fourth day in a row, but from considerably lower levels on the week. Grain prices are bouncing from extreme selling that was encountered Thursday after the WASDE crop report put out a gauntlet of bearish numbers. Recovery this morning is led by soybean oil and soybeans as analysts see the soybean yield guess as too optimistic even though a large portion of the growing season lies ahead.

Soybean all registrations continue to drop, with another 525 contracts canceled late Wednesday to just 224 contracts remaining. On July 1, soybean oil registrations were 1,036 contracts and have fallen by 812 contracts to 224 today. The cancellation of deliverable receipts reflects strong US cash soy oil market opportunities, and end users see the deliverable receipts as a low-cost source of supply. Crush rates are in seasonal decline as soy oil production is off and supplies are tightening on biofuel demand.

The US dollar is in freefall and below 100.00 this morning, enticing fund managers to look towards commodities with renewed improvement in overseas purchasing power. Meanwhile, September Paris milling wheat is up 1.25/MT to 229, in the drop in EU wheat production indicated by WASDE yesterday.

UN top official Guterres sent a letter to Putin outlining how to keep the Black Sea export corridor open. This would include removing hurdles to the Russian state Ag bank for transactions and allowing the continuous flow of Ukraine grain exports. Russia’s Foreign Minister said he has not heard of any new proposals.

India, the world’s largest rice exporter, is considering banning exports due to drought and rising prices. Indian wheat prices are also gaining as this key world consumer struggles with food inflation. Many are anticipating India will become a grain importer in the coming year, supportive to wheat prices.

The extended 11-20 day forecast for the North Central US is looking drier and warmer. In the near-term, Ridge Riding storms the next 10 days across the Midwest look to occur with extreme heat confined to the southern plains and SW Midwest. Forecasts are starting to argue for Ridge to form over Canada/North Central US in late July/August. The N Plains/NW Midwest/Canadian Prairie dryness could possibly deepen with the biggest impact on Canadian crop production.

Live and feeder cattle yesterday experienced a major technical reversal after rallying sharply after the release of the WASDE crop report, with gains of over $2.00 in live cattle and $4.00 plus in feeder cattle. An abrupt reversal occurred at those levels, with the rejection prices at these new contract highs, sending them lower on the session. This technical damage warns that a correction of significance could be in the near future. Cash markets were still quiet through yesterday, with feedlots in the South passing on bids at $176 and offering shoulders for sale at $180-182. It appears the outlook for the last half of the week will be steady/weaker.