Today is day 3 of the Pro Farmer Crop Tour.

This morning’s grain trade finds row crops firmer as results from the Pro Farmer Tour failed to live up to the NASS potential yield of 183 BPA on corn and 53 BPA on soybeans. The key will be whether Illinois and Iowa corn yields and soybean counts today remain strong, but so far, the tour argues for a 2-4 BPA yield decline in corn and a 5-1.50 BPA drop in soybean yield.

The Pro Farmer tour reported Nebraska corn yield at 173.25 BPA, up 3.6% from last year, with ear counts lower than 2023. The 2024 Nebraska corn yield estimate is up nearly 4 BPA from the three-year average. The crop report forecasted that Nebraska would harvest a record corn yield of 194 BPA, up 6.6% from 2023. Indiana's corn yield is predicted at 187.5 BPA, up 6.7 BPA from last year and a 3.68 percent gain. The 2024 yield was only up to 3.4 BPA compared to the three-year average. The crop report had Indiana forecasted for a record large 207 BPA of corn as of August 1, which would be a gain of 2% from last year.

The soybean count for Nebraska suggests that yield on pod counts up marginally from last year and the 3-year average. The 1% yield gain was disappointing compared to the crop report forecast of a 14.6% gain at 59 BPA. Indiana soybean pod counts were up 7.6% from last year and a 13% gain from the three-year average. The crop report had Indiana for a record soybean yield of 62 BPA. The Pro Farmer tour argues that the Indiana soybean yield could be 66 BPA.
The Canadian rail strike is of high concern, and long efforts are underway to avoid a labor strike on Thursday at midnight.

Negotiations continue under building political pressure to reach a resolution. Canadian farmers are now active in their harvest and will run out of storage capacity in 10 days without significant movement by the rail system. Also, spring wheat from North Dakota, Minnesota, South Dakota, and Montana rolls through Canada to reach western ports.

Speaking of wheat, India’s domestic wheat values have now pushed above $9.00/Bu as millers are asking the government to release stocks from its reserve to help quell a tightening marketplace. The supply tightness is much worse than in prior years, and traders expect that India will be forced to drop the 40% import duties before year-end. If so, India will import 3-5 MMTs of world wheat in 2024/25.

The Midwest weather forecast calls for dry and warming weather for the next 7-8 days, with uncertain rainfall chances for the N Plains and the Lake states after that. Little to no rain is forecasted for the N and C Plains, along with the Delta and S Midwest, over the next 10 days. Heat and dryness are now causing a rapid fall in soil moisture that is pushing crop maturity, and a flash drought is developing in the southern Midwest. Soybeans are in their formative reproductive stage and are at the biggest yield risk.

Another plunge yesterday, as live and feeder cattle futures took out the prior week's lows, leaving no doubt in traders' minds that a top is in from last September, with the rebound top for live cattle futures just less than 30 days ago. Through all of this, the highs were September 15, 2023, and the anniversary date this year could be setting up for a low.

The Cattle on Feed report, coming up this Friday afternoon, has an average trade estimate for July Marketings of 108%, the Placement rate of 103%, and the August 1 Feedlot inventory of 100% of a year ago.

The cash trade on Tuesday had a quote of $186 on a live basis for the North, which was $4 lower for the week, and the dressed trade, which was down $3 at $295. Sales in the South were down $2 in Texas, at $183, while the Kansas trade was $1 lower, at $184. More business will likely continue this week, but weaker cash trends have been set. October live cattle hit continuation moving average support yesterday at 175, so it needs to hold. Be sure to watch yesterday’s video, as we show the stair step levels for October cattle are at 173 with a projected potential wave move to 169.50-170.00.