A bit of Turn-around Tuesday greets the morning.

Grain prices are mixed this morning as wheat consolidates its sharp five-day gains, while soybeans bounce off the 1300 price range as actual rainfall continues to be less than expected while forecasts maintain hopeful prospects. Corn prices are steady/firm as Brazilian corn prices have risen dramatically on tightening stocks and now trade a sizable premium to Chicago as world demand shifts to the US. Typically, China buys corn from the US in February/March, but some think it will be sooner.

Egypt is tendering for wheat in the January/February window, with their lowest offer being reported to be $250/MT FOB, terms being potentially 270 days of credit, and the buyer's option. It’s expected it will be sourced from Russia and Eastern European nations.

This Friday is the WASDE Supply-Demand crop report, with the only crop production data being South American crops. The average analyst's guess for Brazil is a soybean crop of 160.2 MMTs and corn at 127 MMTs. The Brazilian guesses reflect a decline of 2 MMTs in corn and 3 MMTs in soybeans due to hot/dry weather in the fact that the USDA is so slow to adjust downward in weather markets. Meanwhile, Argentina is getting a corn estimate of 54.8 MMTs, while soybeans are 48.2 MMTs.

Forecast models for Brazil are varied, and their solutions now going forward with the GFS always remaining the driest and the European the wettest. Dry weather will now occur across Northern Brazil for the remainder of this week, with showers returning on the weekend. Forecasts maintain their backloading of rain, which has occurred since mid-November, because of the expectations of the monsoonal season that should befall Brazil at this time. And Brazilian rain in the new 10-day rainfall forecast is from .5-1.75” with high temperatures ranging in the mid-80s to lower 100s. Heavy rainfall continues to drop in southern Brazil and starts again tonight with another 3-5.50”.

Another heavy selling day in live and feeder cattle, with new lows being created across the spectrum. All feeder cattle contracts now through May 2024 are below the cash feeder Index which yesterday was down $2.62 at $223.27. Box beef was sharply lower, with choice dropping $2.47 at $294.99 while select declined to $2.66 and was at $262.83.

The USDA did a report yesterday that large forward beef sales were up 1% to a 4-week high, led by a sharp jump in the 0-20 one-day sales. Those sales were up 27% from the previous week and were at a 10-week high. This is a bullish element, but first, the market must shake its sell-every-uptick mentality, with index funds being cleansed of market length that they don’t want anymore. We anticipate that the $165 range with slippage on either side is major support if challenged, while feeder cattle have major weekly chart support in the 205 range with slippage on either side.