By Kirk Maltais


-- Wheat for May delivery rose 1.7% to $5.84 1/4 a bushel on the Chicago Board of Trade on Tuesday, leading grains higher as traders spent the day getting their positions in order ahead of the start of March on Friday.

-- Corn for May delivery rose 0.7% to $4.24 1/4 a bushel.

-- Soybeans for May delivery fell 0.2% to $11.43 1/4 a bushel.


HIGHLIGHTS


Bargain Bin: Futures prices were seen as attractive for bargain hunters Tuesday morning, said Matt Zeller of StoneX in a note, providing grains with a lift that lasted into the afternoon.

The rise was seen as mostly technical, with little on the fundamental side supporting the uptick.

"We've still got a month to go until the March quarterly stocks and planting intentions," Zeller said.

The USDA's March planting intentions report is typically one of the biggest movers for grains ahead of the start of the spring planting season.


Running Out of Gas: The short-covering rally that kicked off the trading day for CBOT grains faded by the afternoon, getting tripped up by the question of whether an appetite for short covering will last heading into next month.

"New U.S. export demand news and/or confirmation of smaller South American crops is needed to sustain a recovery," said AgResource in a note.


INSIGHT


D.C. Watch: Just below the surface Tuesday, a potent issue lurking among traders is what effect a U.S. government shutdown may have on grains futures.

One possibility is that a shutdown of the USDA could limit the amount of reliable data available ahead of this spring's planting season, said Daniel Flynn of Price Futures Group. He adds that a USDA shutdown as part of the wider government could delay the availability of farmers to procure loans to help them with planting.


New Market: Ethanol's proliferation into the auto fuels markets appears to have hit a wall, but could see another surge if jet fuel starts to incorporate more of the corn-based fuel into its mix. The expected adoption of the GREET model by the Treasury Department is seen as opening the door to airlines procuring more ethanol-based sustainable aviation fuel.

SAF represents only 1% of the current jet fuel supply, and is typically made of ethanol, vegetable oils and other organic sources, said Andrew Swanson of the University of California, Davis, in a research note.

More will have to be made to meet environmental demands, with ethanol the readiest supply to make an impact.


Alternate Choice: Cotton futures trading on the ICE closed up 4.2% to 98.8 cents a pound, the highest they have been since September 2022. Cotton has been on an upward trend this year, and U.S. growers appear to see an opportunity to tap into a tighter world market, which may in turn cause some farmers to alter their growing plans for the year.

"Is cotton going to gain unexpected acres and take away from either corn or beans in the Southern U.S.?" Total Farm Marketing analyst Naomi Blohm asked in a note.


AHEAD


-- The EIA is scheduled to release its weekly ethanol production and stocks report at 10:30 a.m. EST Wednesday.

-- Hormel Foods is due to release its first-quarter earnings report before the stock market opens Thursday.

-- The USDA is scheduled to release its weekly export sales report at 8:30 a.m. EST Thursday.

-- The USDA is due to release its monthly agricultural prices report at 3 p.m. EST Thursday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

02-27-24 1602ET