Wheat trade softens on hopes of Gulf moisture.

Overnight action in the grain markets is leaning softer, with the wheat futures lower by a dime again as long-range weather models bring in Gulf moisture in the 10-14 day. Soybeans were higher overnight but have now faded to small gains. The pressure across the grain complex is also tied to a mix of end-of-week position squaring and a market that is starting to pay more attention to cooling export demand. Export sales for grains are still running ahead of the pace needed to satisfy USDA targets, but the momentum has eased from the stronger levels seen earlier.

Soybeans are facing some of that same export slowdown, but the market is treating it differently. With soybean balance sheets still relatively tight, softer demand is less threatening than it would be in a looser supply setup. Beans are also finding underlying support from ongoing logistical disruptions in Brazil, along with uncertainty surrounding that country’s export rules. Even so, some caution in the soy complex would make sense heading into the weekend, especially with traders inclined to lock in gains after the recent firmness.

There is not much in the way of new agricultural headlines this morning, and that lack of fresh input is contributing to a quieter tone. One pattern worth watching is the trade flow itself: recent sessions have tended to show weakness overnight, followed by a return of buying interest once the day session gets underway.

Outside the farm space, one late development yesterday briefly rattled equities: reports that Israel would assist the United States in efforts to reopen the Strait of Hormuz. Reopening that route remains critical, but the timeline still appears uncertain and could stretch for weeks. The broader economic effects are becoming harder to ignore. U.S. retail gasoline prices have climbed about 90 cents per gallon since the war began, and consumers are beginning to respond by pulling back on travel.

The White House continues to argue the energy spike will be temporary, but that view is not widely shared. A number of economists and industry sources warn that it could take months or longer for global energy markets to stabilize. Adding to that concern, Qatar has said restoring its natural gas infrastructure after the recent attacks may take three to five years, underscoring how prolonged the fallout could become.

Yesterday’s live and feeder cattle closed on the lows of their sessions, and have a mixed expectation this morning. Technical indicators are in sell mode, while outside market influences could create a short-covering rally on Friday. Index funds are actively exiting the cattle trade and deploying capital elsewhere. This afternoon’s COF report is expected to show smaller ownership through this past Tuesday.

Yesterday’s feeder index showed the best gain of the week, climbing $2.37 at $360.69. The spread again is widening out with only 11 days to expiration. Negotiated fed cattle trade will likely wait till this afternoon’s USDA COF report. (On feed 99%, placed 99.8%, marketings 93%). On a side note, Mexico has 1025 active New World screwworm cases, with 28 cases in bordering states. Consumer demand is the reason for the recent weakness, as high energy prices are expected to remain in place for some time. Even the opening of the Strait of Hormuz will take weeks to get ships to reenter and then transit, getting flows going.

On the charts, the June cattle contract is the active contract with immediate support at 228-229 if selling persists. Resistance is 234-235. For May feeder cattle support is in the 338-340 range, with resistance heavy at 350-51.