Grains recover from overnight early weakness.
Grain prices opened lower overnight initially from harsh comments from the Chinese Communist Party against the US in public papers in their country. However, buying resumed at 8:00 PM CDT when Chinese trade opened, and their corn and meal futures surged higher. This, along with crude oil making new contract highs, put support across the complex.
News that Pres. Erogan of Turkey put 10 diplomatic ambassadors on a list, including Germany, France, and the US were no longer welcome in the country. Their Lira fell to a record low. Turkey is one of the world’s 3 largest wheat importers on an annual basis, the collapse of their currencies will add to the cost of buying wheat and inflation in their country. This was also why wheat moved lower more than soybeans on the night session opening before recovering and making new contract highs.
Paris wheat futures pushed to new contract highs up €2.75 at €280.50 a metric ton overnight, with Chinese corn up 6.4 cents to $10.32 a bushel while their January soybean meal was up $2.85/MT to $516.25. December Malaysian palm oil rose 52 ringgits to 5088 RM/MT.
NASS will report new crop wheat condition ratings today, anticipating that the good/excellent category should be in the high 65-69% range.
The Midwest experienced heavy weekend rainfall which will delay the harvest and increase yield risks. Strong gusty winds are likely toppling corn are stalk quality is compromised by disease. Rains will continue this week, with the Eastern Midwest receiving another .5-1.50” of rain. The extended 7-14 day forecast does have needed drying weather but includes a decline seasonally in temperatures as cold weather builds across Central Canada. Mid-November turns colder.
Brazil will experience favorable weather for their spring seeding and crop development, while some needed rainfall to drop over Argentina to help with early planting dryness. Argentina does look to pick up some lite rains this week.
After closing lower last week for live cattle and feeder cattle, a firm outlook is anticipated from a bullish October Cattle on Feed report. The September feedlot marketing rate was at trade expectations of 97% of the prior year, but the placement rate was 4% lower than the average guess at 97%. October 1 feedlot inventory was 99% which was expectations. Last week negotiated fed cattle prices across the Plains traded in the South at $124 and $2 higher in the north at $124- $126. Boxed beef values look to have confirmed a low last week. The choice cutout gained $1.58 to $281.82. Select values were $2.49 higher for the week at $263.11. December live cattle have significant resistance at 130.50-131.00.