Expected planting progress has the grain trade lower this morning.

This morning’s grain trade is lower across the board as seeding progress came in as expected. US corn seedings at 83%, soybeans at 68%, and spring wheat at 88% through Sunday, which is at the historical averages. The 2024 corn and soybean crops are getting seeded this week, with a lot of re-seeding occurring with drowned-out low-lying crop areas from last week's storms. The tone is now turning slightly bearish without new US export demand and slowed Chinese interest in soybeans. It all comes down to wheat and the observation of whether Russia will receive rain next week or not.

Reuters reports that India is set to lower their 40% duty and import wheat for the first time in six years. The dropping of import duty will come after the presidential elections in June, with private traders to import 3-5 MMTs in 2024/25. Any imports will likely be sourced from Russia, further complicating tightening world stocks and the need to slow trade to preserve supplies. The policy decision on wheat imports will come from the new incoming administration.

According to sources, Argentina is getting closer to finally shipping corn to China. Several varieties of GMO corn have cleared phytosanitary hurdles for import. Technical issues have yet to be resolved before the trade can start, but China approved Argentina wheat back in February, and import tonnages are modest currently. China is currently looking to diversify suppliers amid heightened US/China economic and political competition with the Biden administration and a potential/likely Trump administration.

The grain trade has a nearby bearish tone since the completion of the Memorial Day weekend and the anticipation of high crop ratings being released next Monday. Keep in mind there is no correlation between high early crop ratings and final yields, but it certainly implies the crop is off to a good start. Long-term weather models have come with forecasters predicting a warmer and drier summer, which is still 30 days off.

Rain needed in the Plains are falling this week, with varied rainfall/temperatures for the Midwest into June 9. The Midwest has planting opportunities this week, followed by rain on the weekend and cool/dry weather window in the 11-15 day period. The forecast is favorable for US crop yields, other than wheat crop quality concerns. Corn seedings should be 90-92% next Monday, and soybeans should be 77-80%.

At the close of Tuesday, live and feeder cattle had a higher day, with a firm start offered this morning. Cash markets will probably hold off until Thursday, with the early week outlook expected to be steady. Box beef values were higher yesterday on some restocking demand. The choice cutout gained $1.67, and the select rose $1.71.

The April marketing rate was elevated with record carcass weights, yet last week’s cold storage report showed that US beef stocks declined 1% in April and were down 5% from a year ago. At the end of April, US beef stocks are at 431 Mil pounds, the lowest in seven months and the smallest April figure since 2019. It also measures out to be the second lowest in the last decade. April also marked the 15th consecutive month that stocks were below the previous year. Seasonally, we see stocks tending to fall into August and are likely to decline rapidly in June as there are two fewer working days in the month.