Potential rain in the 10-15 day SA forecast.

Grain futures are lower across the board this morning, as the 11-15 day forecast for S Brazil/Argentina is offering a potential pattern shift, as some would suggest, that reduces rain in northern Brazil and brings about .5-1.5″ of rain for the dry southern areas January 17-21st with some cooler temperatures. However, confidence is low, as what is known more confidently is a 10-day forecast of absolute dry conditions with record heat for Argentina and southern Brazil all of next week. Temperatures will range from 98-112° with acute dryness through January 17. This produces the potential for rapid production decline, but the prospects of rain 10 days out always catch the marketplace's attention on a hoped-for improvement. Some forecasters think this is just an interlude chance of rain while others postulate a potential pattern change.

Malaysian Palm oil was strong overnight, closing at 5226 RM/MT. This supported canola pricing overnight, up over $14 MT at $1038. Soybean oil is trading at 59.00, which is slightly higher in the session.

The January crop report is out next Wednesday and early estimates have the 2021/22 ending stocks expected to rise 10 Mil Bu for wheat at 608 Mil Bu on reduced exports. Ending stocks for soybeans are forecasted to rise 8 Mil Bu to 348 Mil Bu while the US corn ending stocks fall 21 Mil Bu to 1472 Mil Bu. With the estimates so tight, this opens up the expectations of a surprise.

This morning's employment data was a large miss with the jobs added only up 199,000 when they estimate was for an increase of 447,000. This has the stock market drifting this morning, but crude oil is still trading over $80 a barrel.

Cattle futures were mostly higher yesterday, with February cattle holding important support at the 100-Day moving average near 141. On Thursday following Wednesday's trade, cash markets went quiet at $138-140. Box beef values were higher on Thursday, with choice beef moving $1.63 higher at $268.56 and select beef was $1.03 higher at $260.64. Steer carcass weights in early December were 929 pounds and have started to turn down. The latest slaughter report shows both steer and heifer carcasses are at record weights for late December, but seasonal highs are likely in place, with weights looking to fall now into early summer.