The grain trade endured new lows overnight after a Sunday night firm start.

The grain trade started out firm overnight but drifted lower by the early morning hours, with soybeans finding support six cents lower in the session and closing a few pennies higher. Cash contract liquidation and early this week on Hedge to Arrive contracts. Algo and AI trading systems are the sellers of rallies for now, as there is no chart-based indication of a bottom.

AgRural analysts estimate Brazil's safrinha corn planting is 73% complete, and the Brazilian soybean harvest is 40% complete. They went on to lower their r Brazilian soybean production estimate -2.4 MMT to 147.7 MMT.

The Commitment of Traders Report showed managed money sold 26,391 contracts of corn (net -340,732, record short), sold 2,177 contracts of beans (net -136,677), sold 12,852 contracts of wheat (net -68,524). According to Peak Research, in nine other reports, funds have only exceeded a net short of 300K corn contracts. Corn prices rose 100% of the time in the three months after (as the market ran out of sellers, and the algos are currently starting to cannibalize themselves). Factors that are keeping funds entrenched in short positions include growing world stocks, uninspiring US demand, low-priced global fob offers, a weak Chinese economy, and a strong US Dollar.

You can tell that Egypt is getting close to tendering, as they are touting from their supply minister that the strategic wheat reserves are at 3.5 months and veg oil reserves are at five months. In the past, this would mean tenders were almost eminent.

This week culminates the February Bears month, with a liquidation bottom likely being formed by or ahead of the first notice day for March futures this Thursday. China soybean crush margins are now in the green, and feed grain import margins are near a 2-year high. China is known for being a buyer of corn in February and March. They have not purchased in February, so they will likely arrive in March.

PCE inflation data this Thursday, and analysts expect +2.4% y/y vs +2.6% y/y last month. The next WASDE Report is March 8th. The next FOMC rate decision is March 20th.

Rains did fall across the northern half of Argentina over the weekend with totals of .3-2.50”. Scattered showers dotted the northern portion of Brazil, but coverage of rain was patch year. High temps range from the 80s to mid-90s, with a few degrees warmer than seasonal averages being reported. The concern is the fall in soil moisture for winter corn across northern and central Brazil is starting to develop. The crop has just been planted, and its moisture needs are modest now, but it’s key that better rainfall during March with the monsoon forecast prematurely withdrawing going into April.

Live and feeder cattle futures are anticipated to open softer this morning after Friday’s Cattle on Feed report results. On Feed Feb 1 100.4% (exp 100.1%), January Placements 92.6% (exp 88.4%), January Marketings 99.9% (exp 99.8%). The report indicated that 90,000 head more feeders were placed in January versus the expectations from the arctic blast that occurred in mid-month.

Last week’s negotiated fed trade held off until Friday morning when higher prices materialized in all regions; live sales were quoted $one three higher for the week at $183, with dressed sales in the north up $7 and $292. February live cattle futures are pricing in another $2-3 gain in cash prices ahead of this coming week's expiration. Prices in the South are now within $2.50 of the record highs that were traded last June. Box beef values last week had choice gaining $4.41 to close above $300 for the second time since early November.