Grain futures have a mixed start for Tuesday.
Grain futures found overnight stability with Dow futures and energy values also recovering after Monday’s massive risk-off liquidation. Dow futures and energy values are recovering at is again becoming understood that omicron is not a major threat other than it is the variant which is very contagious, and for that reason could create a situation where hospitals become overwhelmed. Pres. Biden is expected to announce this evening the White House will be delivering 500 Mil tests to Americans with additional aid for hospitals under strain while also redoubling efforts to get all vaccinated. No close in the US economy will be announced which has calmed markets.
Crop condition updates are awaited from S Brazil and Argentina with weather forecasts continuing to show two weeks of below normal rainfall with increasing heat. Temperatures are anticipated to be in the 90s to lower 100s which will be adding stress to parsed crops. The South American weather pattern remains static with rain in N, while dryness remains to the South. Western Parana in Brazil is the center of the drought that is building outwards.
Three trading sessions remain this week with markets close Friday-Sunday. New market length is hesitant to enter, making the last trading week of the year more explosive, as crop stress builds and threatens trend-line yields.
Weather for the central Plains remains dry over the next two weeks, stressing wheat that experienced blowout last week from 100-mph winds. Additionally, yesterday RMA data on winter wheat acreage enrollment showed acres for 2022 totaling 10.7 Mil acres, down 894,000 from a year ago. NASS will publish its first 22/23 winter wheat acreage on Jan 12. This is against the grain of industry thoughts of a 1-2 mil acreage increase.
The US has applied economic sanctions to a Belarus Potash Company, a major world exporter, which will further tighten supplies into the US.
Cattle futures were lower yesterday with a slow start to the cash cattle trade. Small numbers moved in Nebraska at $135, $2 lower from last week with the rest of the country quiet. Cattle and Hog reports are out Thursday afternoon.