Turn-around Tuesday with wheat softening and row crops gaining.

Turn-around Tuesday is underway, with wheat giving back some of yesterday’s gains while corn and soybeans recover in price. After breaching the soybean oil chart's 200-day moving average, Soy oil continues to gain, bringing in new technical buying from heavily shorted positions from managed index funds. Overnight Ukraine corn basis bids jumped $0.26/Bu yesterday amid the coming heat/dryness for its corn production area.

Heat and dryness have been a problem for the Black Sea wheat/corn production since April, with the latest round of extreme heat occurring during pollination. Ukraine spot corn is now offered at $0.70 under, with Brazil corn at $0.75 over versus the US Gulf at $0.60/Bu over. Argentine corn offers are almost nonexistent beyond October, as a second corn crop yield results continued to be disappointing on corn stunt disease.

Yesterday’s crop conditions report showed corn declining 2%, soybeans steady, and spring wheat rising 1% in the good/excellent categories. The US winter wheat harvest is now past 54% completed, which helps reduce selling pressure as the latter part of the crop is stored away. For corn, 11% of the crop is now silking, and 3% of the soybean crop is setting pods.

The US ag attaché reduced its 2024 Brazilian soybean crop estimate to 150 MMTs. Historic flooding across the Rio Grande do Sul area during May and early-season extreme heat and dryness curtailed soybean crop yields. Although wide variations in Brazilian soy and corn crop estimates still persist, late-season supply for export availability will determine final crop estimates. Brazil has 147 MMTs for its crop, while the USDA says it has 152 MMTs.

The upcoming central Midwest forecast offers cool/wet weather that favors crops outside of the saturated soil areas of the NW Midwest/Eastern Northern Plains. Additional rain will likely reinvigorate flooding/ponding of cropland. The seven-day QPF rainfall forecast calls for additional heavy rain through the Eastern N Plains and the NC Midwest with totals of 2.50-5.00’. The rainfall will aggravate the current flooding, with ponded fields acting as a yield drag on any soon-to-reproduce corn/soybean fields. Too much water is acting as a yield nemesis of the US corn and soybean crops in 2024. Disease pressure is sure to follow with any return of upper Midwest heat.

Live and feeder cattle futures pushed lower on Monday as follow-through technical selling started the week. August feeders bounced off the 50-day moving average support, but the cash feeder Index fell $3 on Monday after setting a record high last week. Negotiated sales volume last week fell for the second week, with packers booking 68,000 head with 49,259 for 1-14 day delivery and 19,620 for 15-30 day delivery. Box beef values had Choice gaining $2.86 while Select was $1.91 higher. The early cash outlook for this week is steady, with the board acting like a top was set last week. If selling pressure persists, August live cattle will have significant support, near $179.50-180.00.