Grains firm ahead of holiday-shortened week.

Futures opened firmer overnight on light short covering (Turnaround Tuesday). While markets were weak for much of yesterday, strength into the close carried into overnight trade, setting the tone for a better open today. Fresh news remains limited. Export interest is picking up, and South American weather has turned less favorable, but neither development has sparked significant new buying. Meanwhile, concerns over softer demand and its impact on balance sheets remain priced in.

Cash markets are firm as buyers look to extend coverage ahead of both Thanksgiving and a looming winter storm expected to dump snow across the Great Lakes and parts of the Midwest. The forecast could halt movement for several days, further tightening near-term supplies. Even without the storm, farmer sales are expected to slow into year-end.,

Yesterday, Secretary of Agriculture Rollins indicated that an agreement between the US and China should be signed within the next 2 weeks, and that the Farm Aid package, due to last year’s depressed values in negotiations, would also be announced in this timeframe. There is debate that the deal being signed is altered a bit from what was initially reported.

There are reports that China may have secured 2-3 cargoes of sorghum and soybeans yesterday. This could be the start of just constant soybean purchases that are not massive, but continual. It’s difficult for the market to get excited over this. They like big fanfare.

Position squaring is likely to dominate today’s action ahead of the holiday. The trade follows a regular schedule through Wednesday, will close for Thanksgiving on Thursday, and wrap up early on Friday. There will be no night session on Wednesday and Thursday evenings.

Cattle futures plummeted yesterday on the open, with both live and feeder cattle contracts immediately trading limit down, on news of the Tyson food plant closing in Lexington, Nebraska, for January 20, and the reduction in staff at their Amarillo facility to one full shift today. A few contracts traded off limit briefly, but limit-down status remained on all contracts. Today, expanded limits of $10.75 for live cattle and $13.75 for feeder cattle are in effect.

Synthetic option trading suggests January feeder cattle were trading near $300 with the March-September contracts all synthetically down more than $4.00. December live cattle were trading down $2.20, while deferred contracts were anywhere from $1.60-2.70 lower for the February contracts forward. Box beef values had seen choice off $0.99 while select was down $1.47.

A low water mark should be attained today ahead of the upcoming low-volume holiday trade, with action revealing raw value for live cattle futures and feeder cattle contracts this morning. $200 on December cattle is a 62% retracement of the last part of the cattle bull market that got underway on April 2024, with spot feeder cattle having the same 62% retracement value at $288.