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Grain Comments: 03-26-2024

Good morning.

Markets are mostly lower at the CBOT to start turnaround Tuesday, as soybeans retrace some of yesterday’s gains. Newswires lacked a specific reason for yesterday’s rally, with most under the assumption that funds covered more shorts ahead of Thursday. Choppy, back-and-forth trade likely continues through 11am central time on Thursday, when traders are set to receive new government data to chew on. Corn futures are around a penny lower, soybean futures are down 4-6 cents, and the Chicago wheat market is unchanged to down a penny. Products are lower, soybean meal is down $1/ton, and soybean oil is down 20-30 points. Outside markets are mostly higher, crude oil futures are trading 10-20 cents/bbl higher, the Dow Jones index is up 100 points, and the US$ index is down 20 points.

The biggest news story overnight is not grain related; a 1.6-mile bridge over the Patapsco River in Baltimore, MD collapsed after a support pylon was hit by a container ship early Tuesday morning. As it pertains to markets, the port which uses the river is one of the biggest on the East Coast.

Russia announced it may redistribute quotas among grain exporters in the event of systematic failures by the exporters; this following the RIF trading house situation, where an ag watchdog said the company shipped grains that do not meet international standards.

Newswires report that 400,000 mt’s, or 6 cargoes, of Russian wheat is caught up in the dispute with the government, as Moscow refuses to issue phytosanitary certificates.

According to StatsCan, Canada crushed 898k tons of Canola in the month of February. This was up 10.6% from last year, and cumulative Aug-Feb crush is seen up 12.4% from last year.

Weekly winter wheat condition ratings showed g/ex conditions improved by 9% and 5% respectively in Oklahoma and Texas, while falling by 2% in Kansas. OK is now 70% g/ex, TX is 51%, and Kansas is 53%.

The EU crop monitoring committee (MARS) estimated the 2024 EU soft wheat yield 2% higher than in 2023 in its first estimate of the year. Yields are also expected to be above the 5-year average.

Yesterday’s cold storage report showed pork supplies were down 12.5% from Feb of 2023. Beef supplies were also seen lower y/y, coming in down 11.6%.

The quarterly hogs and pigs report, out Thursday afternoon, is expected to show the US hog herd at 74.18 mil head, compared with 74.14 mil head last March. Breeding inventory is seen down 2.9% y/y, and market hogs are seen rising 0.4%.

Several US executives are expected to be extending their stay in China after receiving invites to a meeting Wednesday with a top leader, who most assume is President Xi Jinping.

Weather forecasts remain mostly the same for South America; N/C Brazil sees rains of 1-5″ over the next 10 days, while Argentina and Southern Brazil are mostly dry. This area sees small shower chances this weekend.

The US Midwest sees a band of potentially strong storms stretching from LA to MI Tuesday and moving towards the East Coast. Areas of the Northern Corn Belt see a snow/ice mix as a separate system moves North into Canada.

72-hour precipitation totals were seen anywhere from 1-4″ in a large area of the Midwest including parts of Iowa, Minnesota, Wisconsin, Illinois, and Missouri; rains were welcomed in these areas.

Longer range forecasts now see the possibility of cooler air beyond the first of week April for much of the Midwest, possibly lasting now until the middle of month.

Have a great day!

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