This morning’s grain trade is mixed/higher with soybeans leading the recovery. After StoneX released its highly expected large yield, and did not disappoint, they put out a yield of 188.1 BPA on corn and 53.6 BPA for beans. The market had already anticipated a high corn yield, so it recovered the bulk of the overnight loss after dipping to new lows overnight. At the same time, soybeans pressed through the previous day’s high for the second day in a row, holding a previous day’s low for the first time in two weeks. A first of the month low for beans was on track. Now the question is what kind of recovery rally is, especially with soybean meal gaining well over $10.00 in four days, on bear spread unwinds against it, while soybean oil has stabilized.

Yesterday’s crop ratings remain uncharacteristically high for this time of the year, with corn at 73% good/excellent and soybeans sliding 1% to 69% good/excellent. November soybeans are challenging $10.00 this morning. A close above that threshold with December corn closing higher today would signal that the large crop play is already large enough and being met by a growing demand base for the crop.

Yesterday’s export inspection numbers were again surprisingly strong for soybeans, with decent wheat loadings. Corn was still a good number compared to prior years, but is slipping from prior weeks. What is being missed in the export realm is that we are moving grain. Numerous purchases are adding up to a big demand. It appears the street wants to see large sales every day, rather than cumulative sales that are getting the job done. Watch for a corn close today above 407.4 and soybeans above 10.00 to trigger a bigger recovery rally heading into the August 12 crop report. Our bearish July 20-August 4 window is behind us, and the trade can be more two-sided to the upside in the coming week.

A warming trend is set to develop later this week, with highs in the 80s to the lower 90s. That warmer trend looks to remain in place for the next two weeks. Temperatures are forecasted to be near 5° above average. There are chances for rain in the Midwest this weekend, but totals are in the light shower range except for the Iowa/Wisconsin border area, which could receive some significant totals.

There was another extensive trading range for feeder cattle yesterday, with yesterday's feeder cattle hosting a $7.00 trading range, within two days of last Thursday’s $10.00 range. There’s an old saying that volatility picks up when trends start to lose their long-standing momentum. With box beef not performing, there is a fear that the Packers will not be bidding cash cattle higher this week. Yesterday’s box beef was firmer by $1.10 on choice and $1.09 on select, but it was very moderate in volume.

Feedlots are again out looking for another $2-4 higher. We will likely not see the cash cattle trade take place again until Thursday/Friday. Tyson was out with the report saying they are seeing a significant movement of protein choice from beef to chicken. In fact, Tyson’s chicken profitability is covering their losses in beef for now.

Pres. Trump has been known to be erratic with his tariff decisions. With the stroke of the pen, he could add a beef exemption to Brazil’s 50% tariff, alongside orange juice, airplanes, and airplane parts. Also, the USDA has not forgotten about the Mexican border and is working extensively with its counterparts in Mexico to put together a tight operational protocol to reopen the border on a measured level.