The grain trade softened overnight, but did not implode on Pres. Trump's 15% section 302 tariffs.

Grain futures opened a steady soft on the Sunday evening session and maintained moderate losses in the night session. Global confusion over Pres. Trump’s use of tariffs, which he reapplied under Section 301, up to 15%, has the grain trade in caution mode, as it is unclear whether the remaining trade deals will struggle to be implemented.

The fact that the soybean market did not implode in price Sunday night, which was not reminiscent of the volatility on Friday, suggests that China can still secure 8 MMTs to satisfy Pres. Trump’s expectations are likely still in play. This counters the narrative that other trade chatter is pushing. Brazilian soybean harvest is moving along, but is still behind last year’s pace. Add to that truck lines as long as 24 miles, proving that the ports that cannot handle this big, beautiful crop, and the US stays in export mode to meet on-demand needs.

The first notice day for the March grain contracts is this Friday, and more aggressive rolling from the March to May contracts will be seen over the next four sessions. Option expiration has seen a significant drop in open interest, suggesting new players will want to return to reestablish positions. Whether it becomes new short selling of call options or also selling of puts will determine whether the market still wants to be range-bound for corn. Soybeans spent last week absorbing their recent strength via high-level consolidation, while the wheat trade is experiencing renewed farmer selling after a quick multi-day surge. Rain forecasts for the southern plains in the 10-15 day models has Kansas City wheat retreating on its spread gain over Chicago last week.

Friday’s Cattle on Feed report was considered slightly friendly on the placements figure, while no major surprises were seen in the marketings or on feed numbers. The cash feeder Index last week climbed to a new record high of $377.37, gaining over $3.00 on the week. Late-traded cattle on Friday were $2-4 higher in the north at $247-249, while the South was quoted at $249, which was $1 higher in Kansas and a $2 gain in Texas.

The cattle slaughter report showed 516,000 head last week, which was off 25,000 from the previous week, and it’s down 49,000 from the year ago. It was the smallest non-holiday week kill reported by the USDA since the data began in 1990, excluding the pandemic. Despite this, box beef values last week didn’t show much activity, with choice up $2.23 while select canceled that, being off $2.68. April feeder cattle need to hold 362-363, with April cattle needing to find significant support at 238-239.