What Traders are Talking About:
Overnight highlights: As of 6:10 a.m. CT, corn futures are trading mostly 1 to 2 cents lower, soybeans are 3 to 7 cents higher and wheat futures are 3 to 6 cents higher. Cattle futures are expected to open the week slightly higher on short-covering, though the poor finish last Friday could trigger followthrough selling. Lean hog futures are seen opening under pressure.
* Rains disappoint in the driest HRW areas again. Scattered rains fell across portions of the Southern Plains over the weekend, but the driest areas of western Texas, and the panhandles of Texas and Oklahoma got very limited precip. There are a few more rains forecast for early this week, though they too are expected to remain east of the driest areas. After this system passes, hot and dry conditions are expected through Friday, with another rain event possible by this weekend, though any rains are again likely to favor eastern areas of the region.
The long and short of it: USDA will begin releasing national winter wheat crop conditions ratings this afternoon. They will reflect impacts from the harsh winter and ongoing drought across HRW country. But traders already know about the HRW crop deterioration so the decline in crop ratings likely needs to be more than expected to produce a strong price response.
* USDA S&D Report out Wednesday. USDA's March 31 Prospective Plantings and Quarterly Grain Stocks Reports failed to provide any major surprises. But strong second-quarter 2013-14 corn and soybean use sets the stage for USDA to lower its old-crop carryover projections for those commodities in Wednesday's Supply & Demand Report. Based on a Dow Jones newswire survey, traders expect USDA's 2013-14 corn ending stocks forecast to dip to 1.403 billion bu., down 53 million bu. from last month. Old-crop soybean ending stocks are seen tightening to 139 million bu. from 145 million bu. last month. Wheat carryover is expected to rise 23 million bu. from March to 581 million bushels.
The long and short of it: While USDA is likely to raise its soybean export forecast, the agency still has 12 million bu. of "slack" in residual use to work with and a bigger soybean import forecast (see next item) isn't out of the realm of possibilities.
* Brazilian beans arrive in at U.S. Gulf. A shipment of Brazilian beans from the Port of Santos arrived at the U.S. Gulf over the weekend. This is just one shipment of what is expected to be near-record soybean imports into the U.S. for the 2013-14 marketing year as end-users deal with tight domestic supplies. It's uncertain if this was a cargo that was originally sold to China and then resold to U.S. buyers amid slackened Chinese demand, though it seems likely that is the case. Additional cargoes of Brazilian beans are expected to arrive at Southeastern U.S. ports as its cheaper for end-users to import supplies into the region than rail them from interior locations.
The long and short of it: USDA currently projects 2013-14 U.S. soybean imports at 35 million bu. (953,000 MT), which would be the second largest ever behind 36 million bu. (980,000 MT) in 2012-13.
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