Wheat futures correct overnight.
Wheat futures corrected in price overnight, as India further opened up the possibility of shipping wheat to neighboring countries such as Bangladesh and Pakistan. This has some in the trade wondering what the ban really implies, other than it doesn’t want to sell wheat to the world, just to neighbors. Even if the decision is political, India’s wheat supplies are contracting from what was considered more comfortable levels when a larger new crop was anticipated than is currently being harvested.
The Wheat Quality Council tour participants on Tuesday night pegged the average HRW yield in northern KS at 39.5 Bu/acre versus a five-year average of 46.9. The tour also has shown a dramatic difference between crop health in the East compared to the West. In the West, many fields were completely barren areas that were most impacted by the drought similar to North Dakota in 2021. Last week NASS pegged the Kansas wheat yield at 39 bu/acre, once the tour is completed with results Thursday afternoon, this will be the benchmark yield for balance sheets.
Warmer temperatures are anticipated in France while recent runs have also trended drier for Germany. Soaking rains will impact far eastern France, Italy, and pockets of Germany over the next five days otherwise a warm arid dry condition is in place into June.
Current weather forecasts are becoming volatile in the 8-15 day range with tropical storm activity picking up. But the pattern continues with precipitation in the N Plains and Midwest into early next week. A more organized system works across the E Plains, Midwest, and Delta next Wednesday-Friday. Temps cool in all regions on the weekend while abnormal heat returns to the Southern and Western Plains beginning May 26.
Cattle futures finished yesterday with moderate losses as a softer cash tone to start the week wait on futures. Cash trading started Tuesday afternoon with southern deals established at $138, down $2 from last week’s levels. The northern dressed trade was at $226-227, which was $2-3 lower than last week. Feeder cattle were pressured by the overall strength in grains which will be corrected today. The premium of cash futures soften the tone a bit yesterday which allowed future prices to leak. Retail beef trade was firmer on the day with choice gaining $0.17 and select higher by $2.52. Load count was late at hundred and 18 loads.
Early estimates for this Friday’s COF report have on feed 101.2, placed at 93.6, and marketed at 97.7.