Grain futures look to Friday's WASDA report.

Grain futures had a firm session overnight on light volume after the three day holiday weekend on rumored Chinese buying of futures in place of FOB/CIF bids which are unavailable at the Gulf. Typical with overnight strength, grain futures faded in the later hours of the morning session. The trade awaits fresh news on the return of US Gulf export capacity and Friday's USDA September crop production report. Accumulating estimates have the average September 2021 trade corn yield estimate is 175.8 and 50.4 BPA on soybeans.

Russia's statistical agency, Rosstat, did not raise its all wheat seeding estimate as the ag minister claimed by 1 Mil HA and left it unchanged at 28 Mil hectares, the same as in July. Corn seedings fell slightly to under 3 Mil HA. Current yield data point to a Russian 2021 all wheat crop of 70.5-72 MMTs.

ABARES lifted their 2021 Australian wheat production forecast by 17% to a near record 32.6 MMTs, just behind the record set last year at 33.3 MMTs based on favorable rains in July/August. Australia is the world's 4th largest wheat exporter, but September/October rainfall will determine the final size of the crop. Unfortunately, the coming forecast is arid with rising temperatures. Therefore, better rain will be required in late Sept/October during wheat reproduction.

September looks warm with below normal rainfall across the Plains/Midwest, with just a few showers across the Lake States of WI/MI into September 15th. A Ridge of high pressure holds across the West Central US, which will block meaningful rainfall from reaching into the Plains, Delta, or the Midwest in the next 10 days. There will be a few showers during September 16-17th around the Lake States, but confidence in the rain this far out is low. Otherwise, this is a very warm/dry weather pattern that will cause a further draw in soil moisture levels. There is no evidence of any frost risk for Central US crops into September 22nd, with the S Midwest corn/soybean harvest to get underway in a few weeks. The warm/dry flow will push crop maturity. A disturbance in the Gulf of Mexico is not expected to develop into a tropical storm. The system will produce heavy rainfall for the AL/FL coastlines later this week. The recovery effort in NOLA is not expected to be impacted with dry weather forecast for the next week.

Cattle futures fell all of last week on fund liquidation and bearish seasonal tendencies, while the cash cattle trade was light and scattered during the week. Limited trade took place in Nebraska at $126 or $1-2 lower, and dressed sales at $200-203 were $1-4 lower. Sales in the Western Midwest were $2-3 lower at $125-126. The boxed beef market confirmed a seasonal top and fell sharply last week. The choice cutout was down close to $9 for the week, led by a $21/cwt break in the round value. The select value fell more than $11, and the choice/select spread rose to a historic $33 choice premium. The CoT report showed that funds sold 9,000 live cattle contracts last week, liquidating 10% of their net long position. This was the largest week of selling since late April. In addition, funds sold nearly 300 feeder contracts, but the net long remains at a three-year high.