Stats Canada data deemed friendly for wheat and canola.
Grain futures tumbled sharply in the night session, a negative reaction to the late heavy losses in the stock market, which saw risk-off trade driving prices lower. Also, a warmer forecast for next week offers more planting opportunities added to the selling. By morning wheat prices were higher in the session as stats Canada data at 7:30 AM proved bullish for wheat and canola.
Stats Canada data was friendly as the All Wheat number came in at 10.103M MTs versus an estimate of 10.442. Canola stocks were 3.940 MMTs on an estimate of 4.581 MMTs. Oats were 947, 00 tons versus a guess of 1.063 MT. Barley was near estimates. It was the stats Canada data that helped send wheat futures higher on the session and create new contract highs for spring wheat.
Concerns are growing that the European weather forecast looks dry across France, Germany, and the Baltic for the next two weeks. Drought appears to be deepening with 89% of the French wheat crop rated good/excellent on Friday down 2%.
OPEC ratified a small supply hike of 432,000 barrels/day, but there are adults OPEC can increase production much as spare capacity has been dwindling. Only Saudi Arabia and UAE have any spare capacity to produce additional crude oil from OPEC members. This will not be enough to counter the new EU sanctions by the US against Russian crude oil. Oil prices are trading back to the highs valuations not seen since late March, with spot crude all at 109.45.
The Central US forecast models show a change in the overall pattern being offered as a high-pressure Ridge pushes the jet stream northward. Storms continue to target the N Plains and NW Midwest with ongoing planting delays. Warming temperatures though into the 70s/80s for daytime highs become present next week. This is now the first occurrence of high-pressure ridging across the C and E US in months and it could be a preview of summer weather patterns.
Cattle futures are called stated lower following weakness into the close with June cattle again struggling at the 50-day MA at 136.00. Light cash trade began building on Thursday with $140 cash trade in the South which was steady with last week in the north ranging around $146. Northern dressed trade was at $232 which was again steady with last week. Box beef prices had choice dropping $4.56, while select was off $1.87 on a movement of 159 loads. The choice/select spread narrowed to 9.37 which could be reflecting a more current cattle supply. Feeder price action was week and charts again are technically week having stalled under trendline resistance from the February highs. Overnight weakness on the feed grains may offer early support for feeder cattle.