Grain prices softened on a likely Pres. Trump victory.

Grain futures opened mixed and then quickly turned lower due to unfavorable weather and a steady dollar following Saturday’s attempted assassination of Pres. Trump. Algorithm trading systems kicked in high gear, selling on the precipice of a likely presidential Trump win.

Algos are preemptive selling that Trump will place new tariffs on China beyond the ones that Biden has left in place, forcing them back to the table to the proposed agreement of working with the US to reduce the massive trade deficit. This allows China to pick up soybeans on currently unfounded fears, as it is still six months away from the next president, who will be installed on January 20, 2025.

Today, at 11:00 a.m., the NOPA will release the June soybean crush estimates for a record 178 million pounds, up from last year’s 165. Soyoil stocks are pegged at 1,670 Million pounds, down slightly from last year’s 1,690 Million pounds.

Current grain trade pricing reflects a value for 182-184 BPA corn and 53 BPA soybean yields. The August crop report from NASS will adjust US planted and harvested acres due to FSA data. It’s anticipated we will see a combined 1.5-2.0 fall in corn and soybean acreage.

Russia’s IKAR has raised its 2024 Russian all-wheat crop estimate to 83.2 MMTs from the June estimate of 82. Better-than-expected winter wheat yields across Krasnodar, Rostov, and the Volga region were the reason for the crop increases. The spring wheat crop is seeing mixed weather, with heat and dryness across the West while ample rains are seen across the East.

The Black Sea and eastern Europe summer row crops continue to suffer under a deepening drought and record heat. Corn crops are going backwards quickly to the dire weather as temperatures are in the mid-90s to lower 100s. The forecast stays hot and dry for the next 14 days, which has private analysts now considering Sharp falls in EU and black Sea corn production. EU corn prices are not following the lower trend at the Chicago Board of Trade amid the dwindling crop prospects. Corn prices on the MATIF are $4.00/MT higher than last week.

An interesting situation is that a considerable managed money short is being built to a record combined corn and soybeans of over 530,000 contracts. This is occurring as global cash basis bids are firming and CBOT prices are declining. How long will China wait to start making sizable purchases of US soybeans on a gamble that the Democrats change horses for the race and change the outcome? US soybean corn and soybean yields as big as the trade is discussing will be checked in the September crop report for the deciding vote. It is not uncommon for futures to get ahead of themselves and sharply reverse.

A favorable Central US weather forecast is offered for the next 10 days as a high-pressure Ridge holds across the western US, leaving the Central US in an NW upper airflow that produces very high temperatures and rainfall. No extreme Midwest heat is forecasted. However, the Northern Plains and Canadian Prairies will see only limited rainfall. Already across the Western Canadian prairies, soil moisture is coveted as short. The western US Ridge has shown staying power and will produce ongoing extreme heat/dryness. Wildfires are now expected to become commonplace again in August.

Live and feeder cattle futures ended up lower last week, while a firmer start is anticipated for early trade. Cash trade last week developed in a wide range, with live sales in the north quoted $one lower at $198, and the dressed sales were also $one lower at $312. Live trade in the South was mostly $2-4 lower at $188. We again see a widening of the north/south spread to a $10 north Premium, which matches the mid-June high.

Cattle slaughter last week totaled 600-1000 head, 32,000 head less than a year ago. Last week’s kill was down 5% from year ago and the lowest for the week since 2015. This projects a July/September slaughter of 7.92 Mil head, and also lowest since 2015. Carcass weights continue to offset fewer head. Last week’s average weight was 844 pounds, down 10 pounds in the May high but still 3 pounds heavier than a year ago.