Soybeans advanced to the 100-day MA overnight.

This morning, A firmer grain trade for soybeans and wheat as the dryness in N Brazil and W Russia for the next 10-14 days is becoming a concern as those droughts deepen. Brazilian farmers concede soybeans into November, but like last year, tightens the planting window of winter corn crops. The drought in northern Brazil has been the worst in 30 years. Over the last month, the dry weather concerns of N Brazil and W Russia have managed money short covering into the end of the month and the quarter this coming Monday.

Russian October FOB wheat is offered steady at $217/MT, with December Paris wheat futures higher this morning by $3/MT at 222.75. Malaysian palm oil has risen sharply overnight, up 112 ringgits to 4189 RM/MT, a new contract high. Tightening supplies of minor world veg oils have provided a bullish lift and have helped soybean oil sore over the past two weeks.

China is readying another stimulus package overnight, one that mirrors the recent calls from local economists we have been discussing that provide direct-to-consumer stimulus and support to local governments struggling with debt. The $284 billion dollar package, with specifics likely to be unveiled as we work through the end of the week and into next week, is said to have around $142 billion earmarked for different approaches to improve consumption. From incentives to improve or replace business equipment to vouchers for milk and a monthly stipend of $114 dollars if you have more than one child, China will work to up domestic demand. The other $142 billion will go to local governments struggling with massive debt loads. In addition, another $140 billion or so will be sent to banks that may also be struggling. Officials reiterated their actions after the recent Politburo meeting, saying they would do whatever it took to meet growth targets. Experts call this a ‘strategic shift in macro policy,’ like changing the sentiment surrounding China in a big way if the policies stick.

Soybeans challenged the 100-day overnight while December corn stalled shy of the early week high. A correction on Thursday is probable given the extended nature of the grain trade during the throes of harvest. The weekend harvest pressure trade is coming today/Friday

Long-term weather models in the 10-15 days window are trying to add moisture to northern parts of Mato Grosso, with some improvement noted in the extended forecasts as well. With daily high temperatures still soaring over 100 degrees, progress remains slow across much of the country. Argentina’s outlook remains mixed, with some issues popping up from too much rain in southern Brazil, Uruguay, and Paraguay.

Cattle futures closed mixed on Wednesday, leaving them slightly changed at midweek, while feeder cattle futures were higher. December cattle held within a narrow range at midweek but closed near session highs as the market consolidates recent gains. December cattle have now climbed $10 from the early month low. Most of the negotiated fed cattle markets are still at a standstill, but on Wednesday, a small number reportedly sold in Iowa at $184-186, which was $steady-$2 higher. Asking prices in the South were quoted $185, which was $2 higher. The packers have not shown any interest yet this week.

Cattle slaughter at midweek is totaling 486,000 head, up 7000 from last week but 2000 head fewer than a year ago. The choice cutout value dropped $3.72 and select was off $3.59. The choice cutout is now off $1 this month, led by a $19/CWT correction in the loin primal. A seasonal low in the loin primal is typically foraged in the first half of October. December cattle are stalled at resistance at 185.00 with November feeder cattle eyeing a challenge of resistance at 245.00.