WASDA data out at 11:00 AM Central today.
After a volatile mixed overnight session, grain futures closed on their highs, with July December corn futures at their contract highs. Today’s USDA supply-demand data will be closely scrutinized at 11:00 a.m. on how they play with balance sheets by inputting trend yields or better than trend yields into carryouts. This is important when you consider new-crop December corn, as even record yields produce a carry out for the 2022/23 crop year near 1 Bil Bu.
Newswire reports this morning that there was some frost across Argentina, where a few locations were under 32°, but damage to crops is said to be minimal. Overall, no meaningful increase in rain for the next 10 days for North Central Brazil’s winter corn crops which are becoming dry with high temperatures in the 80s to lower 90s.
Central US weather shows a low-pressure trough slowly pulling to the Eastern Midwest with widely scattered showers and some lite snow. A strong jet stream and a series of storms will pass across the Northern Plains in the Midwest over the next two weeks. Heavy snowfall is anticipated to blanket the Dakotas with 12-14 inches accumulations that carry into Minnesota and Wisconsin. Unfortunately, the central and southern plains will only see a few rain shots, worsening drought conditions into April. In addition, the Delta continues to endure more flooding, slowing the spring corn planting.
Live cattle futures had a firm close yesterday while feeders were mixed with strength in deferred prices. Again today, feeder cattle will be affected at 11:00 a.m. by the results of the USDA crop report involving feed grains. Box beef values were mixed, with the choice slipping four cents to $271 and select gaining $0.17 at $261.22. USDA monthly price data on beef spreads show the farmer’s share of total retail value has risen to a 23-month high of 40% up from the miserable Covid valuations due to packers claiming excessive costs. As a result, producers will continue to gain leverage as feeder cattle/fed cattle supplies tighten starting in the fourth quarter well into 2023. Currently, feedlot inventories are at historical highs, and packers are working their captive supply to maintain cash values below $140.