Good morning!
Wheat leads overnight price gains... Corn, soybeans and wheat were supported by followthrough buying overnight, led by gains in the wheat market after an unexpected downtick in winter wheat crop ratings. As of 6:30 a.m. CT, corn futures are trading 3 to 4 cents higher, soybeans are fractionally higher, winter wheat markets are 8 to 11 cents higher and spring wheat is around 6 cents higher. The U.S. dollar index is down about 150 points and front-month crude oil futures are around 30 cents lower.
India pursues three-phase trade pact with U.S. ahead of July tariff deadline... India is pursuing a multi-phase trade agreement with the U.S., aiming to finalize an interim pact before President Donald Trump’s reciprocal tariff package takes effect in July, according to Bloomberg. The deal is expected to unfold in three stages: Phase 1 (pre-July): A limited agreement covering market access for industrial goods, selected agricultural products and easing of non-tariff barriers, such as quality control standards. Phase 2 (Fall 2025): A broader agreement potentially covering all 19 areas listed in the terms of reference signed in April. This could coincide with Trump’s expected visit to India for the Quad summit. Phase 3 (2026): A comprehensive final agreement, pending Congressional approval. Indian Commerce Minister Piyush Goyal is currently in Washington meeting with U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick to accelerate talks. Both sides have yet to formally confirm the three-tier structure.
Trump to rally House GOP as reconciliation fight reaches boiling point... Trump will address the House Republican Conference this morning in a high-profile push to unify support for the sweeping reconciliation bill known as the “One Big, Beautiful Bill” Act. The meeting is set for 8:30 a.m. ET in the Capitol, with Trump expected to deliver his remarks at 9:00 a.m.Trump’s visit underscores mounting urgency and turmoil within the GOP ranks, as House Republicans remain at an impasse over key provisions of the reconciliation package — particularly on Medicaid reform, tax credits and state aid formulas. Speaker Mike Johnson (R-La.) has signaled flexibility, with GOP leadership tentatively proposing a phase-out of clean energy credits by 2028 and openness to FMAP reforms. Still, these moves have not quelled concerns among GOP moderates. Even if the bill clears the House, Senate passage remains a major hurdle.
HRW, SRW CCI ratings inch lower... USDA rated the winter wheat crop 52% “good” to “excellent” and 18% “poor” to “very poor.” On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop slipped 0.2 point to 328.4. The SRW crop inched 0.1 point lower to 374.8. The modest declines came despite improvements in the top producers for both crops – Kansas for HRW and Illinois for SRW. Click here for full details.
Crop Progress Report highlights… Following are highlights from USDA’s crop progress and condition update as of May 18:
- Winter wheat: 52% good/excellent (54% last week); 64% headed (58% average).
- Corn: 78% planted (73% average); 50% emerged (40% average).
- Soybeans: 66% planted (53% average); 34% emerged (23% average).
- Spring wheat: 82% planted (65% average); 45% emerged (34% average).
- Cotton: 40% planted (43% average).
Cordonnier raises Brazilian corn production forecast... South American crop consultant Dr. Michael Cordonnier raised his Brazilian corn crop forecast by 2 MMT to 129 MMT, with the safrinha crop accounting for 1.91 MMT of the increase. He projects the safrinha crop at 99.8 MMT – 78.7% of total production. Record yields are reported in Minas Gerais, Sao Paulo, Goias, Mato Grosso, Bahia, Rondonia and Tocantins. Cordonnier left his Brazilian soybean production estimate at 169 MMT. Despite recent flooding in Buenos Aires province that we reported in “Evening Report” on Monday, Cordonnier kept his Argentine crop estimates for soybeans and corn at 50 MMT each.
China’s soy imports from U.S. and Brazil fell in April... China imported 1.38 MMT of soybeans from the U.S. during April, down 43.7% from last year. Imports from Brazil dropped 22.2% to 4.60 MMT. During the first four months of the year, China imported 12.95 MMT of soybeans from the U.S., up 35.2% from the same period last year. China’s Brazilian soybean imports totaled 9.14 MMT from January through April, down 42.5% from the same period last year.
China cuts interest rates... The People’s Bank of China (PBOC) cut benchmark lending rates for the first time since October. The one-year loan prime rate (LPR), the benchmark for most corporate and household loans, was lowered by 10 basis points to 3.0%. The five-year LPR, which guides mortgage rates, was lowered 10 points to 3.5%.
Farm groups slam White House MAHA report ahead of release... Politico reports that leading U.S. farm organizations issued a blistering statement Monday criticizing the forthcoming report from the White House’s Make American Healthy Again (MAHA) Commission — even before its public release. Groups including the American Soybean Association and the International Fresh Produce Association warned the findings could severely damage relations with producers and undermine American food security. “Should the MAHA Commission report baselessly attack and, worse yet, make claims that are simply untrue against the hardworking men and women who feed our nation, it will make further cooperation on this initiative very difficult and potentially put American food production at risk,” the coalition said in a joint statement. The statement also takes aim at White House official Calley Means, described as a key advisor to President Robert F. Kennedy Jr. on the MAHA initiative. According to a person familiar with the matter, Means has refused multiple meeting requests from farm representatives.
Three Brazilian HPAI tests come back negative... Brazil’s ag ministry said three of the seven tests for suspected cases of highly pathogenic avian influenza (HPAI) came back negative – all three from non-commercial farms. Two of the cases still under investigation concern poultry raised on commercial farms. A confirmed case of HPAI was discovered on a commercial farm in Rio Grande do Sul late last week, while the other two suspected commercial farm outbreaks are in Tocantins and Santa Catarina. Officials said the U.S. will continue buying eggs from Brazil, despite the outbreaks. Brazil’s ag minister said the country could resume poultry exports within 28 days if no new cases are confirmed. Some 35 countries, including China and EU members have suspended poultry imports, with some being full bans and others regionalized.
UK confirms case of atypical BSE... Britain said a single case of atypical Bovine Spongiform Encephalopathy (BSE) had been confirmed on a farm in England and the animal had been humanely culled, adding that there was no food safety risk. Atypical BSE is a naturally occurring, non-contagious disease in cattle which occurs spontaneously and is distinct from classical BSE, the UK government said.
Cash cattle nearing short-term top?... Cash cattle averaged a record $226.45 last week – the fifth straight weekly gain. During that span, cash prices have surged $18.75, including four straight record highs. But another week of strong purchases has packers relatively covered on near-term needs, especially with a holiday-shortened schedule next week. Therefore, most cash sources believe this week’s prices will be steady at best as packers try to improve deeply negative margins.
Cash hog fundamentals strengthening seasonally... The CME lean hog index is up another 20 cents to $91.46 as of May 16. Pork cutout firmed 97 cents to $101.09, the highest since the Feb. 17 peak at $102.47. Tightening slaughter supplies should continue to generally strengthen cash and product prices into summer.
Overnight demand news... Exporters reported no tenders or sales.
Today’s reports
- 1:00 p.m. Fruit and Tree Nuts Data — ERS
- 1:00 p.m. Vegetable and Pulses Data — ERS