A softer grain trade except for the hard wheat.
This morning’s grain trade is softer; after yesterday’s rally, trends are hard to maintain in our slop-chop-pop markets. EU and GFS models have trended a little dryer across the Southern and Western Plains next week, throwing a bit of support into the Kansas wheat trade while a softening in the row crops as planting will get underway late next week.
Palm oil was down today after reaching a 21-month high yesterday, partly due to a lack of demand, with China’s markets closed for a holiday and general profit taking. The Malaysian Palm Oil Board will be out with inventory, production, and exports on April 15th. Grain trade sources say that the Russian government is expanding its investigation into grain export quality, with some of Aston’s grain shipments halted. Aston has not been issued phytosanitary certificates for two vessels. Receiving countries have also complained more about imported grain quality.
The census US grain/soy trade for the month of February will be published mid-morning, with a sizable jump in corn exports expected. The key is whether official Census data stays a large premium to FGIS-reported shipments. Official corn exports in January were 19% above FGIS. Official soy exports were 11% above FGIS. The Census corn exports for February are estimated at 265-270 Mil Bu, versus 130 Mil a year ago. Soy exports for Feb are pegged at 192-195 Mil Bu versus 197 Mil a year ago.
Fed Chairman Powell spoke at the Stanford Business Forum yesterday and commented that March’s firmer inflation numbers did not “materially change” the Fed’s view on the direction of interest rates. He confirmed the idea of cuts later in the year. Powell’s comments helped to soften the Dollar and propel gold into all-time highs and silver to 2-year highs.
Warm temperatures have developed in E Europe and the Black Sea, and there is no sign of a flip in the dry pattern through April 19. Next week, temperatures in E Ukraine/S Russia will reach the low 70s, which is 10-17° above normal. It is too early to be overly concerned, but the need for rain is immediate heading into May.
The US forecast is drier for the US Plains in mid-April as both the EU and GFS models limited precipitation and the chance of rain for the HRW belt. The forecast is also drier in IA in the upper Midwest. Warmth accelerates evaporation rates beginning next week, and widespread rain will be desired in May. Odds for a timely planting season are on the increase.
Live and feeder cattle closed lower yesterday but well off the early morning lows. A Reversal occurred after the trade pushed new lows for the week on both live and feeder cattle, with consolidation at those prices and a late recovery. The cash feeder Index was down $0.54 at $247.73 but still nearly $7 over April futures. There was some light cash trade in the north yesterday, quoted $189-190, which was steady to $1 higher from last week, and dressed sales were down $ 296. Live trade in the IA/MN region was quoted $187, which was $3 lower. Markets in the South, meanwhile, were untraded, with asking prices at $188. Cattle slaughter through midweek was a total of 123,000 head, down 1000 head from last week and last year. Box beef prices dropped $286 on the choice and select lost $2.07.