Grain futures give up overnight higher start.
Grain futures opened higher last night, with soybeans posting a new recovery high before widespread selling materialized across the complex on profit-taking with Thursday’s WASDA crop report on the way. No production data will be presented in this report, it will just be supply-demand numbers, with many suggesting exports will get trimmed for wheat and soybeans. Weather in S Brazil and Argentina is becoming concerning and was part of the early strength.
Saudi Arabia secured 689,000 MTs of world wheat for July an average price of $365.14/MT CIF. It’s assumed the sellers were sourced from the EU or Black Sea on the new crop pricing. Typically the US captures some Saudi Arabia sales and was not in this tender, prompting selling in the night session.
China estimates its 2021 corn crop production was at 272.6 MMTs, up 4.6% from last year and a new record. Chinese 2021 corn seedings expanded 5% due to record high cash bids. Yield did decline due to excessive rainfall/flooding across NE China. China’s crop estimate is in line with WASDA. WASDA estimates that China will take 26 MMTs on imports with 20 MMTs potentially coming from the US. Chinese private buyers were rumored to have been seeking US corn late last week along with soybeans. FSA confirmation is awaited.
An arid weather pattern continues to persist now across S Brazil and Argentina for the next 10-14 days due to La Niña. There is no indication of the air flow will change by late December. Near to above normal rainfall will continue to across N Brazil with totals of 2.5-5.00”, while S Brazil/Argentina hold in an arid trend. High temps be variable ranging from the 80s to mid-90s. Currently, any heat will be limited to just a few days and centred over S Brazil/and Argentina.
Cash cattle traded higher again last week for the 9th consecutive week. Cattle in the south moved at $142, some $2-3 higher for the week while live cattle the north brought $140, $2-4 more than last week. The 5-area average steer price was estimated at $141 for the week, the highest since May 2017. The only week since 2015 that the average was over $140. Boxed beef values also pushed lower at the same time, with the choice cutout down $5.65 for the week led by a $13/CWT decline in the round value.