Soybeans recover from a sharp overnight tumble on another hoped-for Chinese flash sale.

Grain futures are starting the week firm, while the soy complex came under pressure overnight. Weekend rains across South America weighed on soybeans, as did weakness in the broader energy complex. The firming of soybeans in the morning, recovering from a 10-cent loss, is the renewed morning expectation of another flash bean sale to China.

On Friday, despite a sizable soybean flash sale to China announced, there has been little follow-through buying. This has renewed doubts over China’s true import intentions, with some in the trade feeling actual demand may fall short of recent estimates.

Markets are also positioning ahead of Tuesday’s WASDE report. Expectations are for minimal changes, with USDA typically leaving production untouched in December. Most anticipate a slight increase in soybean carryout, which is adding to pressure in the soy complex.

On the supportive side, reports of low-quality grain in China are helping buoy U.S. corn and wheat, as it could boost demand for higher-grade U.S. supplies. Ongoing disruptions to Black Sea exports due to escalated fighting are also bolstering the U.S. export outlook. Export inspections will be released today, along with another set of delayed export sales from the week of November 6th.  

It is widely expected that the Trump administration will announce today the $12 billion farm aid package to help farmers after the Chinese used the farm economy as a bargaining chip in trade negotiations.

South American weather is showing near-to-above-normal rainfall expected across most of Brazil over the next two weeks. Rainfall is forecast for the northern half of Argentina. Meanwhile, the Buenos Aires region remains dry.

Cattle futures spent the totality of last week rallying sharply, with feeder cattle manifesting a $40 rally in seven trading sessions. The cash feeder index last week put on $25. And it is above 340. Last week’s live cattle sales were up $6 for the week at $226, with live trade in the south up $7 at $226.

Cattle slaughter was on the rebound from the holiday-shortened week of Thanksgiving. The number of head was 600,000, 14,000 fewer than last year and 53,000 under the five-year average. Boxed beef prices struggled on this, with choice off $5.62, while select gave up $3.66.

A 50% recovery of the October/November decline is at 226-227 for the Feb live cattle market, with 341-342 a similar 50% recovery resistance point for January feeders, which is still the spot contract. There is a large gap in January feeder cattle at 340 that carries all the way up to 348.