May deliveries pressure overnight grain trade.

Grain futures are lower on larger than expected deliveries for May wheat, soybeans, and soy oil. Cargill registered 1,873 contracts of soy oil for delivery with a total of 2,101 contracts delivered, which is the largest in years. Bungee stopped 400 contracts, with ADM taking 146, while the remainder likely need to be retendered. The massive soil delivery confirms that crushers are holding large soy oil supplies at plants due to the record crush rates and weak biofuel demand. The seasonal biodiesel demand has not kicked in yet. There were 533 soybean deliveries with no strong hands noted, while Chicago wheat deliveries were large at 1151 contracts. The Andersons were involved in heavy deliveries again, tendering 1,000 contracts with strong commercial hands lacking.

The EPA/Biden administration is expected to announce its revised GREET model for the measurement of carbon intensity of biofuel feedstocks today. The updated model was expected to be released in March but was delayed. Revising the model is critical to determine the eligibility of sustainable aviation fuel for new tax credits created by the falsely named “Inflation Reduction Act.” The key is how US ethanol scored in pathways forward to dropping its carbon score under 50%. To achieve a sub-50 % carbon score by requiring US farmers to adopt no-till farming practices, which many already do, plant cover crops, or start using precision fertilizer applications.

Yesterday afternoon the NASS Crop Progress results showed corn 27% planted (vs 23% last year) and beans 18% planted (vs 16% last year). Winter wheat conditions declined -1% to 49% G/E. The seeding pace this week will be slow this week due to wet weather with progress on corn and soybeans being no better than 6-10%.
Rain showers helped ease the dryness in SW Russia, but the drought is expanding in Ukraine and C Russia.

Fed Policy Decision on Wednesday at 1pm CT. Interest rates will not be cut. The focus will be on Powell’s press conference and the tone to follow. US Non-Farm Payroll data on Friday.

In the US, showers and thunderstorms will occur every two to three days with near to slightly above-normal temperatures. There is no great chance of rain over the western half of Kansas where drought continues to build and causes stress on the reproducing HRW wheat crop. The forecast models call for frontal passes across the Midwest by May 7, with more normal rainfall in the week two forecast window. Some wet flows could persist, causing some back laws of spring seeding after a fast start. US farmers will likely not be able to get 50-60% of the corn planted on a timely basis, which could shift intended acres to soybeans or prevent plant. US corn seeding progress is expected to likely not surpass 35% through Sunday, which makes the week 2 rainfall forecast important.

Live and feeder cattle prices were softer on Monday, with June live cattle finishing near the low of the day but still just above the 100-day MA. Early in the session, May feeders pushed above last week’s high but stopped short of the 50 and 200-day MAs. Last week, the Packers bought 92,548 head on a negotiated basis, which was the most in five weeks. 68,496 head were 1-14 day delivery and 24,052 had the remainder were a 15-30 day delivery. April live cattle go off the board today, while June cattle are at a tighter-than-normal discount to the cash index. WHO officials indicated there has been a risk of H5N1 bird flu spreading in cows in other countries besides the US. Officials believe the risk is low to public health.