Thin volume developing ahead of the Memorial Day weekend.

The morning grain trade is mostly firm as overnight Kansas City wheat pressed the new calendar year high again before retreating into the close of the overnight session. The International Grain Counsel lowered their total world grain carryout estimate for 2023-20 24 x 3 MMTs to 588 MMT, which is 14 MMT lower than the 2022-2023 crop year. Additionally, they lowered their 2024-25 carryout estimate to 580 MMT.

Early this morning, the House Republicans have pushed their farm bill through the Ag committee following a rancorous 13 hours of debate. In the end, the Republican's 14 Democrat votes to allow the bill's passage to be called bipartisan. However, the full House is not expected to take up a vote until September, and the Democrat leadership in the Senate is not scheduling any further action. The 2024 US Farm Bill is unlikely to be passed until after the November election, but passage in the House allows for pre-election talking points.

China has militarily encircled Taiwan with drills designed to test its ability to take power, according to Chinese government statements. The military drills are occurring as the new Taiwanese Pres. Lai Cing-te takes power and openly refutes Chinese claims of island ownership. China’s president Xi has promised that China will re-control Taiwan before his presidency ends. The drills appear to be nothing more than a Chinese show of force, but there is always the risk of confrontation ahead of a three-day weekend.

Excessive rainfall continues to be a problem for French farmers, with corn seeding advancing just 5% to 78% completed and the winter wheat good/excellent ratings falling 1% to 63%. The forecast offers drier weather for most of France for the next 7-8 days with warming temperatures, which should allow farmers to advance their corn seeding progress before early June.

Ukraine continues to hit the Russian military center in Crimea with US-supplied ATACMs, which is helping to confirm that the US has provided clearance for Ukraine to use US weapons to attack Russia. Last week, Ukraine attacked the key grain export port as the war continues to escalate and expand before the US November elections. Unknown is whether Ukraine will use US missiles to strike key ports. With the three-day weekend ahead of us, it’s a day of adjusting for risk with weather and geopolitical events always an unknown.

We will see an active weather pattern in the Central US over the coming days, but there will be seeding opportunities as a five-day stretch of dry weather is offered next week. E Midwest corn and soybean seedings are making progress, but too much rain will drop across the W Delta/E Plains into early June. A storm system is targeting Iowa this morning with rains of .2-1.00″. No extreme heat is offered for the Central US, with near-normal temperatures into June 2.

Live and feeder cattle struggled yesterday and closed lower after setting new highs in the early trade. Profit-taking entry hedging ahead of the May Cattle on Feed report and a Memorial Day holiday weekend triggered selling. Cash trade continued on Thursday, with live sales in the north at $192, which is up $2 for the week.
Meanwhile, the dress trade was $3-5 higher and $302-304. Box beef was mixed with choice down $2.33 for the day and $3.6 one lower on the week. Yesterday select gained and is $2.68 higher on the week.

The May Livestock Slaughter report showed April cattle slaughter was 109% of March and 107% of year ago with one additional working day than March and two more than a year ago. The per-day slaughter rate was 104% of March and 98% of last year. Fed cattle carcass weights were up 9 pounds from March and 22 pounds heavier than last year. Jan-April beef production was fractionally under last year on record carcass weights. August live cattle have rallied $13 above the April low in their back to overbought. Tight supplies look to support sharp breaks, but summer rallies are rare. Broad range trading is expected to develop into the summer.