Overnights selling gives back yesterday's gains into month end.

Grain futures are lower to start the last trading day of the month, as overnight trade failed to provide follow-through buying, and the market focused on rains falling on the radar across Central South Dakota. As anticipated, there is a forecast for weekend showers across Southern and Western Iowa along with eastern Nebraska and Missouri. The reality of the forecasted near-term rains and cooler temperatures sparked the overnight selling to end the month. Despite cooler temperatures for a few days and the oncoming rain in the areas mentioned above, damage has been done this week, and it's anticipated that Monday afternoon's crop ratings will produce a corn and soybean decline of 2-3% out of the GD/EX category. 60-65% of the Central US will remain dry for the next 10 days.

By next week, the US corn and soybean yield potential will be acknowledged in decline with the commercial trade coming to grips that the US yield will not be able to attain trendline yield potential. July ended up being much hotter and drier than what had been forecast over the last 2 weeks, with the last half of July finding extreme heat stressful on the crops west of the Mississippi River. Illinois corn yields must surpass their record of 210 BPA for the US to produce a national yield of 177.5-179.5 BPA. The E Midwest corn crop potential is high, but agronomists do not see it as being record large. Unfavorable August weather can push corn yields below 174 BPA, threatening the balance sheets, pressing corn carryout back near or below 1 billion without upward adjustments to usage.

Brazilian farmers again got hit with more crop problems as cold and snow overcame Southern Brazilian crops on Thursday. It was another frigid morning today, and the Brazilian wheat crop has been damaged in the late boot stage. Yield loss assessments are being made, but the concern is high that any reproducing wheat and maturing corn was lost. Total Brazilian corn production is becoming well-known that it could be below 85 MMTs. The USDA is still 8 MMTs too high and will take months to catch up.

Potential for extreme heat forecasts look to return to the Central US in August. There continues to be uncertainty beyond 10 days in terms of Central US rainfall totals/placement, but the heat will come roaring back into the Central US beyond August 8th. This heat will push corn and soybean maturity to the detriment of yield. A Ridge-riding storm system is pulling across South Dakota and producing estimated rainfall of .2-.9″. The storm is forecast to weaken into the later morning hours, but rains are part of a front that will drop across the Plains/W Midwest this weekend. Iowa, Missouri, and NW Nebraska are favored with rains of .25-1.25″. Next week is largely dry before some rains return to the E Midwest in the following weekend. 60-65% of the Central US holds in an arid weather pattern including S Canada into August 10th. The Ridge/heat comes roaring back in the 9-14 day period, with highs in the 90's to lower 100's once again. The High-Pressure Ridge amplifies north and produces another spate of extreme heat with arid weather conditions for the Plains/W Midwest.

It was a lower day yesterday for cattle futures with a steady weaker outlook anticipated for live cattle day with feeder cattle possibly firmer on the weaker grains. Cash trade on Thursday was reported slow on light to moderate demand across the Plains cattle markets. Trade in the South was quoted at $120 or $1 better than last week. Cattle in the North moved at $122 or steady for the week. The boxed beef market again marked another day of strong gains. The choice-value gained $2 on Thursday ($9 this week), and the select value was $.70 higher ($7 this week). From last week's low, the choice value is more than $10 higher, led by the rib value which has increased $43 and added nearly $5 to the total carcass value.