Grains falter overnight after a firm start.

Futures kicked off post-Thanksgiving trade with a firm night session start and then quickly headed towards modest losses as traders await fresh headlines. Much of the day’s activity is catch-up from last week’s light holiday volume, with positioning expected to ramp up into month, quarter, and year-end.

A major story over the weekend was China rejecting several Brazil soybean shipments due to pesticide and wheat contamination, suspending five exporters. While this could shift short-term demand to the US, price competitiveness remains a limiting factor. Still, China continues to buy US soybeans despite the premium. Flash sales need to continue this week; otherwise, futures will refocus on improved weather in South America and chat again about the record crop potential. Up until now, there has been no formal signing of a Chinese trade deal. China has just been buying beans of its own volition to do so.

Corn demand remains firm, even as some believe sales are being front-loaded. Today’s export data from the week of October 23rd may have a limited impact due to outdated figures.

Overnight, corn, soybeans, and wheat all traded lower. Outside markets saw energies higher, the US dollar weaker, and equities poised for losses after consumer confidence came in 29% below last year, reflecting worries about jobs and retail costs. Without large Chinese flash sales announcements, the grains are at risk of a setback after the beginning of December.

In thin holiday trade, live and feeder cattle prices closed sharply higher for a second day in a row on Friday. This morning’s opening is mixed as traders ponder how much discount to cash they want to maintain. Last week’s sales in the north were $7-8 lower and took place at $209-210. In contrast, trade in the South was off $2-4 at $220. We haven’t seen such a large premium from the South over the North since 2001. Tight fed cattle numbers in the South are due to the closed Mexican border to feeder cattle. Last week’s cutout values had a choice off $4.66 while the select lost $5.93.

Initial resistance on fed cattle will be significant at 220-221, with support now in the 208-210 range. Feeder cattle have immediate resistance at 324-325 with major resistance at 330-331. Support is now established at 309-310, with significant support at 300.