Grains bounce from Tuesday's heavy selling.

This morning’s grain trade is firmer, with wheat leading the advance. Russian FOB wheat is firm at $233/MT FOB, up $15 in the last month. It appears Russia is fully sold off for October, and only limited supplies are still available for November as sellers are starting to hold back. The forecast for rain in S Russia remains limited. Overnight French milling wheat gained over $3/MT and tested last week’s seasonal high price of $235/MT.

Soybeans and corn both experienced chart-based technical bouncing, with gains in soybeans overnight quickly scaled back. Malaysian palm oil declined 25 ringgits, while spot crude remained soft, $5.00/barrel below yesterday’s high. It’s anticipated that Israel’s attack on Iranian oil infrastructure is unlikely ahead of the presidential elections and that crude oil is balanced despite the Middle East conflict against a larger projected OPEC production increase as they follow through on reducing the post-Covid production curbs.

Harvest is continuing at a rapid pace, with yield reports in Illinois and Iowa pointing to record yields easily, while more variability is being reported outside of the core US production area. The weather looks relatively wide open for the next 10 days at least, likely helping farmers wrap up the bean harvest so they can begin to focus on corn. Bean basis is starting to feel weak in the Eastern Belt, though that should be expected with a wide open harvest stretch.

South American weather looks decent for the most part, though model agreement is still lacking regarding the 8-14 day forecasts. The GFS model is much drier than the Euro, with the Canadian somewhere in the middle. According to leading meteorologists, the Euro is the better performing model and the one they trust. Soybean planting has gotten underway in the parts of the country where rain has recently fallen, with farmers looking at another 3-4 weeks before they find themselves outside of the optimum window for bean production potential. Second crop corn potential may start to suffer if the delays grow.

Tuesday was another day of gains in live and feeder cattle, with a firm outlook anticipated this morning. For October cattle, they marked the highest close since late July and the second highest since October 2023. For the second day, October has now closed higher than the December contract. Feeder cattle futures had a stronger day on continued strength in the cash index and weaker corn values. The cash feeder index picked up $1.27 to a 9-week high of $2.4.75, while October-November futures closed above $250.

Cash trade is waiting to occur, and the futures market indicates a higher trade this week, with initial asking prices in the South being quoted at $188, which is $2 higher for the week. Iowa State University estimates for cattle feeding returns showed mixed results for September. Finished 750 pounds steers showed a net loss of $72/head on higher purchased steer costs. Finish dear Showed a net profit of $166/head, with a breakeven of $175 and a sale price of $184. Note that December cattle have reached a gauntlet of resistance now at $188.25-190.00. December cattle now is reluctantly following October higher. The cash markets will need to lead as futures have become tagalong.