Good morning!
Grain futures prices mostly higher overnight… As of 6:00 a.m. CST, July corn was up 4 1/4 cents and hit another four-week high. July soybeans were 1 1/4 cents lower. July soybean meal was up $0.90 and July bean oil was 14 points higher. July SRW wheat was up 12 3/ 4 cents and hit a seven-week high. July HRW was up 18 1/2 cents and hit a two-year high for the contract. Winter wheat futures are attracting more speculator buying interest amid drought conditions in parts of U.S. HRW wheat country. Corn is seeing gains amid concerns high fertilizer prices will see some producers limiting applications and thus reducing yields. (See Pro Farmer consultant Cordonnier’s item below.) Soybeans are still trapped in a sideways trading range but are trading in the upper portion of that range at present. The key outside markets today see the U.S. dollar index lower, while Nymex WTI crude oil prices are up and trading around $95.50 a barrel. The yield on the benchmark 10-year U.S. Treasury yield is presently 4.32%.
Latest on the war in the Middle East…
--Trump not happy with Iran’s latest peace proposals
--Iranian oil tankers are clustering just shy of U.S. blockade line
--First LNG shipment since war began appears to exit Hormuz
President Trump convened his national security team to discuss Iran’s proposal to end a war now entering its third month. Trump will address the matter “very soon,” White House Press Secretary Karoline Leavitt told reporters on Monday. “His red lines with respect to Iran have been made very, very clear,” she said, adding they included preventing Tehran building a nuclear weapon. Iran has signaled it may be willing to accept an interim deal to reopen the Strait of Hormuz in exchange for Washington ending its blockade of Iranian ports, while postponing more complex negotiations over the country’s nuclear program. It is insisting on keeping some control over shipping through the strait, which Washington is unlikely to accept. Reports said Trump told his advisers he’s not satisfied with Iran’s latest suggestions.
More severe weather for the mid-south today… The National Weather Service today said severe weather and heavy rainfall in the Mississippi Valley and mid-South continue to make weather headlines, with another active day on both fronts expected roughly along a Memphis to Dallas corridor. Wednesday the threat of severe thunderstorms and heavy rainfall will slightly shift southward towards the Gulf Coast. By Thursday morning the stalled front in Texas is expected to support unsettled weather over portions of the southern Plains and Southwest. The main threat will be isolated flash flooding in central Texas. Meantime, over the southern High Plains, critical fire weather conditions continue. Parts of New Mexico and Texas will continue to see fire weather concerns into Wednesday. Above normal temperatures will persist ahead of the cold front for much of Texas into parts of Ohio/Tennessee Valley and Southeast for today, while below normal temperatures persist over northern/central Plains.
USDA weekly crop progress reports highlights… Monday afternoon’s weekly USDA crop progress reports showed U.S. corn planting was 25% complete as of April 26, compared with an average estimate of 29% produced by a Bloomberg survey of analysts. That’s up from 11% last week and ahead of the five-year average of 19%. U.S. soybean planting was 23% complete versus an average estimate of 22% and up from 12% a week ago; 12% is also the five-year average for this time of year. U.S. spring wheat plantings were 19% complete versus an average estimate of 25% and up from 12%, while trailing the five-year average of 22%. U.S. winter wheat saw 30% of the crop rated “good” or “excellent,” unchanged from last week. Analysts had expected a slip to 29%, reflecting drought conditions and possible freeze damage to the hard red winter wheat crop in the Plains. On the weighted Pro Farmer Crop Condition Index (0 to 500-point scale, with 500 being perfect), the HRW crop declined 6.35 points to 264.46 and continues to trend below the condition ratings for this time last year. The SRW crop remains in relatively better conditions but still declined 0.97 points to 359.67.
Pro Farmer crop consultant’s weekly report highlights… Pro Farmer crop consultant Dr. Michael Cordonnier’s weekly corn and soybean crop perspective and commentary:
--U.S. corn, soybean acreage – The eventual corn acreage may decline 1-2 million acres due to high fertilizer prices and dry conditions in the mid-South, the southeastern U.S., and parts of the far western Corn Belt.Due to an anticipated slight reduction in fertilizer applications, especially in the fringe areas, the 2026 U.S. corn yield is estimated between 180 to 182 bu/ac.The eventual soybean acreage may increase 1-2 million acres due to switching from corn and potentially other crops due to fertilizer prices and dry conditions. Soybeans are not as sensitive to reduced fertilizer applications as corn, so a slight reduction in fertilizer applications may or may not impact yields.The 2026 U.S. soybean yield is estimated at 52.0 bu/ac.
--The 2025/26 Brazil soybean estimate was left unchanged this week at 179.0 million tons, with a neutral bias. Soybean harvesting in Brazil approached mid-90s percent last week.
--The 2025/26 Brazil corn estimate was left unchanged this week at 134.0 million tons, with a neutral bias.
Fed’s FOMC meeting begins today… Monetary policy makers in the U.S. and across the Group of Seven will probably keep their interest rates steady this week. The Federal Reserve’s Open Market Committee (FOMC) meeting begins this morning and ends Wednesday afternoon with a statement and press conference from Fed Chair Jerome Powell. This FOMC meeting will likely be the last for Powell as head of the U.S. central bank. Canada, the U.K., Germany and Japan are widely anticipated to leave their interest rates unchanged, too.
Major heat wave in India stokes inflation as people, crops suffer… India is facing inflation threats from heat waves and below normal rainfall this year, Bloomberg reports. Temperatures of as high as 117 degrees F have gripped parts of northern India this week and power demand has surged to a record. The government is also predicting below-normal rains between the June and September monsoon season, which is crucial for farming activity. This year’s adverse weather conditions will likely push inflation above 5% annually. “The ongoing heat wave and erratic monsoon will all impart upside risk to food prices that have remained well behaved so far,” said Dhiraj Nim, an economist at Australia & New Zealand Banking Group. The rain forecasts “along with high energy prices and agricultural inputs costs, make for a perfect storm for food prices down the line,” he said. Below-normal rains mean farmers may be forced to use diesel-powered irrigation to water their lands, which would raise their costs further. Some economists like Sonal Varma at Nomura Holdings Inc. say the impact on food prices could be minimized because of India’s strong buffer stocks of rice and wheat. “The risk will be more pronounced if rainfall is affected in July and August, the key sowing months,” said Gaura Sengupta, an economist at IDFC First Bank Ltd,the Bloomberg report said.
Indonesia rolling out B50 biodiesel… Four trucks and a passenger bus have completed a 40,000-kilometer road trip around Java to test a diesel blend comprised 50% of biofuels from palm plantations, Bloomberg reports. Indonesia aims to introduce the B50 blend by July, which will help determine whether the country can deliver its ambitious biofuel-blending mandates and reduce reliance on fossil fuels. The rollout of B50 faces challenges, including a shortage of methanol and potential global price increases for palm oil, which could add to food inflation and impact the country’s ability to meet its targets. “If Indonesia succeeds, it shows that very high biofuel blends are possible when demand is engineered” rather than left to market forces, said Khor Yu Leng, an economist at Segi Enam Advisors in Singapore, who has tracked the palm oil industry for nearly two decades. “This could push other countries to strengthen mandates for energy security.”
Malaysian palm oil futures edge lower again… Malaysian palm oil futures continued to slip, hovering below MYR 4,500 per MT and nearing a one-week low, pressured by a stronger ringgit and weakness in Dalian soyoil. Sentiment was further weighed by softer export demand, with cargo surveyors noting shipments of Malaysian palm oil products for April 1–25 dropped between 15.7% and 16.8% from the prior month, reflecting a post-festive slowdown. Caution also persisted ahead of China’s upcoming official PMI release, which could provide clearer signals on demand conditions in a key importing market. However, losses were capped by firmer soyoil prices on the Chicago exchange. Rising crude oil prices, driven by stalled U.S.-Iran peace talks and mounting supply concerns, also offered support. In top buyer India, purchases are expected to recover after imports fell 19% mom in March. Meanwhile, the Malaysian Palm Oil Council sees prices holding above MYR 4,500 in the near term, supported by high energy costs and potential El Niño risks.
Cattle futures markets once again show keen resilience… June live cattle on Monday rose $3.725 to $248.95. May feeder cattle gained $6.55 to $367.45. The cattle futures markets saw strong buying interest on perceived bargain hunting after the recent sell off that drove prices to three-week lows last week. Bulls are almost right back in business and once again have shown keen resilience on price setbacks. However, from a technical perspective, the bulls need to show more price strength this week to repair near-term chart damage and to then suggest prices can challenge the April highs. USDA at midday Monday reported cash cattle trading last week averaged $246.18, which is down $1.86 from last week’s average trade of $248.02.
Lean hog futures see mild short covering… June lean hog futures on Monday rose $0.275 to $102.175. The hog futures market saw tepid short covering and perceived bargain hunting featured. Strong gains in the cattle futures markets to start the trading week also limited selling interest in hogs. The latest CME lean hog index is up 1 cent at $91.44. Today’s projected cash index price is down 18 cents at $91.26. The national direct five-day rolling average cash hog price quote Monday was $90.84. Technical analysis: June lean hog futures bears still have the overall near-term technical advantage. Prices are trending down on the daily bar chart.