Overnight volatility experienced in the grain trade and outside markets.

Overnight volatility produced a spike in grain prices as Israel mounted a retaliatory attack against Iran last night. This caused the energy and metal markets to spike higher and have now returned to lower levels. The attack was limited in scope; Israel did not acknowledge it, and Iran officials say there are no plans for a response. The situation in the Middle East is very fluid. Grain prices still show small gains after seeing wheat rise as much as $0.20 in the night session.

According to a Reuters report, the EPA is set to announce it will temporarily allow expanded sales of ethanol-gasoline blends from June 1 – Sept 15. Confirmation could come as soon as today. The EPA has allowed waivers in 2022 and 2023. By 2025 it’s anticipated the EPA will allow the year-round sale of E15 and Midwest states.

The Rosario Grain Exchange has reported a significant loss in the potential Argentine corn crop. An estimated $1.3B worth of corn has been eliminated due to leaf hopper insects' spread of stunt disease. This has led to a challenging situation, with BAGE estimating the Argentine corn crop as 20% good/excellent, 44% fair, and 36% poor/very poor, and the corn harvest only 17.2% complete. In India, the situation is equally concerning, with wheat stocks at their lowest in 16 years. The government has sold off large volumes to fill the gap for the shortfall in production due to lower yields in recent years.

Cold/dry weather is forecasted to prevail across the Central US for the next 5-6 days, with a frost/freeze line from Milwaukee southward to Hayes, Kansas, early next week. After that, a warming and wet weather forecast follows, with the potential of exceptionally wet weather to target MO, IL, and IN in the 7-14 day period. The W Plains, Brazil winter corn area, and SW Russia winter wheat areas stay largely dry. Today, the weather is slightly bearish for prices but could become slightly bullish by late April, depending on nearby summer row crop planting progress. Russian wheat crops need rain by mid-May, or prices could become explosive if Russian wheat supplies look to get reduced.

Live and feeder cattle futures were firmer on Thursday, with a mixed outlook for today. The front cattle futures marked modest gains in quiet trade, while deferred futures closed the dollar higher. Feeder cattle marked reasonable gains with the softness yesterday in corn pricing and the deferred live cattle strength. Cash cattle remained quiet through Thursday, with asking prices $184-185 in the South and $295 dressed in the North. Packer bids are quoted at $180 and $290-291. Choice box beef prices slipped $1.01 Thursday at $295.80 and are now down $4.77 for the week. Meanwhile, select box prices were down $1.61 at $289.27, which is off $6.27 for the week. Actual slaughter report for the week of April 6 show the average steer carcass weight was down 4 pounds at 919 Lbs, but they were 27 Lbs above a year ago and a record large for early April.

The Cattle on Feed report is out at 2:00 p.m. CT this afternoon in the Bloomberg average estimates have On Feed at 102% of last year, March Placements at 92.3%, and March Marketings at 88.6%.