Grain futures mounted an overnight recovery.
Non-US grain/oilseed prices rose last week. Russian fob wheat gained for the 6th consecutive wheat with values at $299/MT fob. Russian President Putin claimed on the weekend that Russian grain production would be 127 MMTs and that there is no supply problem. It appears that Russia is cranking up its propaganda machine once again. Brazilian, EU and Canadian values also held firm. World crop production is facing a dire shortfall, and declining US grain prices are out of step with the world market. The US drop offers a budding export opportunity. US corn/soybeans are the cheapest in the world.
The Pro Farmer Tour estimated the 2021 US corn yield at 177 BPA with soybeans at 51.2 BPA. If you use the not surveyed state yields by PF and the state surveyed estimates reported on the tour, the final US corn yield would be 173.9 BPA. US soybean pod counts were more mixed. It's E Midwest weather that will determine where final yields end up. The E Midwest needs several good rains if PF yield estimates are to be reality. Steady or a 2% decline in US corn/soy GD/EX conditions are forecast in this afternoon's crop condition report.
The Central US weather forecast offers the best rain of the '21 growing season for Minnesota/Wisconsin, while limited totals drop across the E Midwest into September 2nd. A southward sliding jet stream and less blocking across Western North America will produce the best chance of rain for the growing season to date across the Canadian Prairies, North Dakota, Minnesota, and Wisconsin. The rains come too late to aid crops in Canada, but they could add to soybean seed size across the Lake States. Limited rainfall is offered for Illinois, Kansas, Indiana and Ohio as soil moisture in these states is in fast retreat. The dryness here could take the top end off yield potential. The North Dakota/Minnesota/Wisconsin rain will add to seed size, but there is concern the dryness in the E Midwest is taking the top end off its yield.
Last week cattle futures closed at the top side of the current trading range, with a firm outlook offered for early trade this week after the August Cattle on Feed report lacked any negative surprises and was friendly for feeder cattle. NASS reported a feedlot marketing rate in July at 95% of last year (97% expected), the placement rate was 92% (93% expected), and the August 1st feedlot inventory was right at expectations of 98%. The total number on feed was just over 11 Mil head which was a new low for 2021. Moreover, the percent of cattle on feed over 150 days slipped to a 6-month low of 20.1%. The cash cattle trade last week was supported by another strong week in beef prices. Cattle in the south sold for $121-122 or steady to $1 higher for the week. Cattle in the north moved at $125-127, up $1-3. Boxed beef values rose sharply during the week, gaining $20-21. Friday's choice cutout quote was a new high for the year.