Good morning!
Grain futures prices firmer overnight… As of 6:00 a.m. CST, July corn was up 2 1/2 cents. July soybeans were up 1 1/4 cents. July soybean meal was up $3.30 and July bean oil was 18 points lower. July SRW wheat was up 3 cents and July HRW was 6 1/4 cents higher. Technicals favor the corn and winter wheat futures bears, with prices trending down on the daily bar charts. Soybean trading remains choppy and sideways but meal has been the standout performer the past few sessions and hit a nearly five-month high Monday. Spreaders are featured unwinding long bean oil, short meal spreads. The key outside markets see Nymex WTI crude oil prices lower and trading around $97.00 a barrel. The U.S. dollar index is weaker. The yield on the benchmark 10-year U.S. Treasury note is presently 4.28 percent.
Latest on the war in the Middle East…
--Fragile ceasefire between U.S., Iran appears to be holding
-- U.S. and Iran weigh further truce talks with U.S. blockade under way
--Trump admin. proposing a 20-year suspension of Iran’s nuclear activity: NYT report
--China’s Xi says world order “crumbling into disarray” as war takes toll
--Switzerland says it’s ready to help in talks to end Iran war
--Global stock markets mostly higher as U.S.-Iran truce talks set to resume
-- China’s oil and gas imports shrink on Persian Gulf turmoil
--WTI crude oil drops below $97 per barrel on signs U.S., Iran may resume talks
China’s Xi weighs in on U.S.-Iran war… Chinese President Xi Jinping lamented a world in “disarray,” using some of his strongest language yet to describe a collapse of the Western-led international order as he vowed to play a constructive role in the Middle East. “The international order is crumbling into disarray,” Xi told Spanish Prime Minister Pedro Sánchez on Tuesday in Beijing, using a Chinese phrase indicating not only chaos but also moral decay, reported Bloomberg. Xi said China would continue to play a constructive role in the Middle East by promoting peace and dialogue. “Xi Jinping underscored China’s principled stance of promoting peace and dialogue, and reiterated that China would continue to play a constructive role in this regard,” China’s state television cited Xi as saying to Abu Dhabi Crown Prince Sheikh Khaled bin Mohammed during a meeting Tuesday morning in Beijing. The Bloomberg report made no mention any Xi response to President Trump threatening new tariffs on China if it supplies heavy arms to Iran.
Warm, windy, stormy weather across the Plains, Midwest… The National Weather Service today said rounds of severe weather along with heavy rainfall are forecast from the upper Midwest to the Great Lakes.These storms are likely to occur in the regions during the afternoons in the coming days. Farther south in the central/southern Plains, additional moisture returning from the Gulf will trigger additional rounds of strong to possibly severe thunderstorms with heavy downpours. These storms are expected to extend northeast across Missouri into the Midwest, again most active during the latter half of each day into the overnight hours.The strong ridge of high pressure that helps feeding the moisture into the southern Plains will also bring high temperatures well into the 80s and will begin to challenge daily records this afternoon in the east-central U.S. As the warm air expands eastward from the Plains to the eastern U.S. over the next couple of days, a cooling trend will gradually work its way across the interior western U.S. with the ongoing unsettled weather. In the southern Plains warm temperatures, dry air and some gusty winds will promote a critical risk of
fire weather over the next couple days.
Weekly USDA Crop Progress data… Monday afternoon’s weekly USDA crop progress report showed U.S. corn planting slightly ahead of average, reaching 5% complete across the 18 major producing states as of Sunday and just ahead of the five-year average of 4% and up from 3% in last week’s report. U.S. soybean planting was 6% complete as of Sunday, which is ahead of the five-year average of 2% complete. U.S. winter wheat headed reached 11%, above the five-year average of 7%. The winter wheat crop was rated 34% good to excellent, 32% fair and 32% poor to very poor. U.S. spring wheat planting reached 7% complete as of Sunday, slightly above the five-year average of 6%. U.S. cotton planting was 7% complete, matching the five-year average.
Trump administration seeks farmers’ help in probing crop inputs gouging… The Trump administration is seeking information from farmers to help with an ongoing Justice Department probe into high costs for fertilizer, machinery and other farm inputs. USDA Deputy Secretary Stephen Vaden said he has met with officials at the Justice Department and the Federal Trade Commission to discuss lines of inquiry, and knows that “farmers have a lot of information that might be relevant to these investigations.” The Department of Justice is investigating whether fertilizer producers colluded to raise prices, Bloomberg reported. “We need farmers to help provide us with that information on a confidential basis, so that that can help inform the investigations that are ongoing,” Vaden said at the North American Agricultural Journalists’ annual conference in Washington on Monday. “I think we will have a mechanism in order to help encourage that exchange of information.” The fertilizer industry has faced scrutiny as only a handful of producers account for most of the U.S. supply of crop nutrients, and prices have never fully cooled after Russia’s invasion of Ukraine in 2022 upset supplies, said Bloomberg.
Top Gulf oil producers can ramp up to 50% production two weeks after war: IEA… Top Arab Gulf oil producers can return half of shut fields to prewar levels of production within two weeks once transits through the Strait of Hormuz resumes, the International Energy Agency said, according to Bloomberg. Resumptions are likely to rise to 80% over another month but would be dependent on companies mobilizing labor and contractors, and the normalization of supply chains, the IEA said in its monthly oil market report. Restarting the remaining 20% would be more challenging because of a reduction in pressure in the fields and other constraints, the IEA said Tuesday. “Restoring output most crucially hinges on safe and sustained vessel transit through the Strait of Hormuz, which has become more complicated following a U.S. blockade,” the agency said.
Malaysian palm oil futures slip… Malaysian palm oil futures hovered below MYR 4,500 per MT Tuesday, retreating after recent gains as a stronger ringgit and weaker edible oil prices in Dalian and Chicago weighed on sentiment. A sharp drop in crude oil prices amid Middle East tensions further reduced palm oil’s appeal as a biodiesel feedstock. Export data added pressure, with cargo surveyors noting shipments tumbled 30.7%–38.9% in the first ten days of April versus March, signaling softer near-term demand. Still, losses were cushioned by expectations that top buyer India may boost purchases ahead of seasonal demand, after a 19% drop in March imports to a three-month low. In China, imports surged to their highest in over four years, underscoring resilient demand. Meanwhile, monthly data from Malaysia showed inventories fell for a third month to a seven-month low. Separately, Indonesia mandated downstream palm oil firms to secure industry certification by March 2027, highlighting the global push for sustainable sourcing.
Cattle futures markets pause and see mild profit taking… June live cattle on Monday fell $0.675 to $248.525. May feeders gained $0.475 to $372.825 and poked to a 5.5-month high. The cattle futures markets saw a pause and some mild profit taking after June live cattle hit a contract high last Friday. A bit more risk aversion in the general marketplace Monday also favored the cattle market bears. USDA at midday Monday reported cash cattle trading last week averaged $248.38. That’s up $3.42 from the prior week’s average of $244.96.
Lean hog futures hit three-month low… June lean hog futures on Monday fell $0.60 to $103.125 and hit a more-than-three-month low. The hog futures market saw more technical selling pressure amid a price downtrend in place on the daily bar chart. The latest CME lean hog index is up 1 cent at $90.28. Today’s projected cash index price is down another penny at $90.27. The national direct five-day rolling average cash hog price quote Monday was $68.45.