Grains mixed, cattle anticipated sharply lower.

Corn prices are posting new contract lows while soybeans are also softer on yesterday’s crop condition reports, while wheat is posting a moderate report recovery. Better crop ratings on corn, the lack of a significant weather threat at the present time, and no bullish surprise in yesterday’s stocks and acreage data are all weighing on corn and soybeans. Ratings slipped lower on both spring and winter wheat crops to give that complex overnight support. The slow harvest pace on the winter crop is also limiting hedge pressure.

The US dollar is tumbling and is almost at its lowest value of 2022. Currently off $0.30 this morning at 96.19, gold is higher by $60 back to 3,369, and silver is up $0.35 at 36.15. Even crude oil is finding moderate support from the weakening dollar despite what we know will be production increases from OPEC in their upcoming July meeting next week. The one big change that’s coming to shift the grain valuations for the last half of 2025 is not likely to be weather, which is benign, and maybe have some help from some trade deals coming together, but it’s the collapse of the US dollar that is not taking center stage. End users are enjoying opportunities to acquire future contract values on sale in anticipation of what is going to be a massive, robust export pace out of the US this fall, as our dollar is competing with the Brazilian real like never before. The Brazilian real is rallying, and nobody is talking about it. They all talked about how it was cheap last fall and how it was hurting us, but for some reason, those currency talkers are silent. We will discuss this in this afternoon’s video.

One thing that is quickly becoming apparent is that this year’s crops are going to be highly variable. We hear just as many reports of great crops as bad crops, and this is from all regions of the US. This is only making it harder to accurately predict this year’s yields. It’s going to take another 2-4 weeks of favorable weather for corn to reach trend or better yields. UST has been forecasting a 180+ BPA for eight years (including this year), and the past seven have not been able to attain better than near 178 BPA. Is this the year we crack 180? If we don’t, then something has happened to the trend. Either it’s soil compaction, hybrids maxing out nationally, or farmers have been fertilizing less. We're going to find out this year if 180 can be bested. There are models out there that suggest we can have 189 BPA.

Cattle futures are anticipated to have a sharply lower opening this morning, as the USDA has stated that the Mexican border will start opening in stages on July 7. It’ll start with one port in New Mexico, and over the next two consecutive weeks, two more ports will be open. Ports will continue opening through August and September to get to full operational, but the reality is the feeder’s cattle supply will be loosening up in the August-September timeframe, which will put pressure on the board this morning. Feeder cattle futures put on nine dollars in three days, and the way the markets were, they could just as easily take that back in a day. We will see, but the discounts have been problem for reason and the three-day snap to the upside will get severely tested this morning.

Negotiated fed cattle sales are expected to hold until late this week, especially until we see the response that the board creates to the border reopening. Box beef had choice off $0.93 yesterday while select picked up a dollar 17. We also have packing plants closed for Friday, and the question is whether some packers will bring workers or can they get workers to come back on Saturday, when they probably want to enjoy a three-day weekend. We have extremely large positions by speculators in the futures market, which may signal that the June 9 high is the high, and as we have been stating, the present rally was expected to be a B-wave lift before the next leg down. On the charts, feeder cattle are targeting 292-295 as the C-wave gets underway.