CONAB reduces crop sizes for Brazil.

Turnaround Tuesday materialized overnight as a grain trade softened from Monday’s strong gains. Meanwhile, soybeans firmed up after 7:00 a.m. as CONAB released their crop yield data, which came in lower than last month as expected. The bean production was at 146.858, down from February’s data of 149.403 MMTs. Corn was also lowered to 112.752 from last month’s 113.696 MMTs. This was anticipated and why the grain trade firmed after Friday’s WASDE data was released. There is now an 8 MMT difference between CONAB and WASDE on the soybean crop and 12 MMTs for corn. The wheat trade this morning is watching for additional SRW cancellations from China, and next on the docket is the March 28 Stocks and Seeding’s report.

CPI data out this morning showed year-over-year inflation of 3.2% versus the estimate of 3.1%, and core CPI was up 3.8% versus a 3.7% estimate. The US dollar is firming this morning after tumbling to 8-week lows. Gold is under pressure today, off over $20 on the session, and silver lost $0.20 after the CPI before finding a bid. Crude oil is also weakening, which keeps the reflex Turnaround Tuesday effect in play.

Ukraine’s grain trade union predicts its grain and oilseed harvest could retract to 76 million acres from 82.6 million acres last year due to lower acres resulting from higher export costs and low global prices. Data from March 1 through the 11th shows Ukraine exported 1.5 MMTs of grain, down from 1.9 MMT a year earlier, according to the Ministry of Agrarian Policy.

The Biden Administration indicated that meat, poultry, and eggs labeled as US products will now be mandated to come from animals born, raised, slaughtered, and processed in the US. This is a win for US ranchers. Due to ASF, Chinese customs said they have banned the import of Albanian pigs, boars, and related pork products.

There continues to be a forecast of below-normal rain across Northern and Central Brazil for the next 10 days. The lack of N Brazilian rain persists during the 11-15 day period, and extreme heat expands into N Brazil on the weekend, with widespread mid to upper 90s. Meanwhile, heavy rain hit the soybean harvests of southern Brazil and E Argentina, totaling 4-7.50”. A sizable decline in soil moisture is forecasted for the northern two-thirds of Brazil, which elevates the importance of late March and April rain for the winter corn crop.

The cattle trade on Wednesday was mostly lower to start the week, while April cattle traded quietly and mainly finished unchanged on Monday, with the rest of the market lower. Feeder cattle were under pressure, as the cash index was down $0.50 to start the week at $248.24. The selling pressure from deferred live cattle and firming corn values with a negative for feeders on Monday’s trade.

Last week, the Packers bought 76,364 head on a negotiated basis. 51,009 69 head were for delivery and 1-14 days and 24,394 for delivery in 15-30 days. Cumulative negotiated beef cattle purchases in 2024 totaled just over 690,000 head, down 11% from last year and the lowest since the USDA began reporting the data in 2003. Some of this is due to tight inventories and Packers attempts to manage supply. Still, these numbers were declining due to the shift from negotiated sales to formula-based contracts.

April feeder cattle need to hold 252, especially on a closing basis, to avoid technical liquidation. April feeder cattle declined from February 26 to February 29 for a total of $8.60. A similar decline from Friday’s high would target just under 250 in simple matched A-B-C leg trading. Keep in mind that C legs are typically longer than wave A.