Lower than expected crop ratings fuel overnight gains.
Grain futures pushed higher overnight on the surprise lower crop condition ratings for corn and soybeans, along with the first day of Pro Farmer yield estimates are considered friendly. Nebraska and South Dakota gave a very poor performance, while even Ohio looks less than desired than early reported. Corn crop ratings as of Sunday were at 55% GD/EX, the second lowest crop rating for this time year since 2012. A steady better rating was anticipated.
The Pro Farmer tour on Monday night pegged South Dakota yield at 118 Bu/acre, down 33 Bu from the tours estimate last year versus the NAS S August forecast of 147. Keep in mind it’s been three weeks since the survey results were tabulated, and it’s been dry. The Ohio tour leg put the corn yield at 174 Bu, down 11 from last year, versus NASS’s August estimate of 190. The tour underestimated Ohio yield and 2021.
Much better yield data potential will be found as the tour moves its way into Illinois and Iowa, where pod counts will be considered large in both Illinois and the Eastern half of Iowa. December corn has taken on its friendlier pattern bursting through moving average resistance, re-targeting the 655-660 range potential.
The Central Midwest US forecast continues with the Ridge/trough pattern holding across the US, which keeps meaningful rain chances confined to the Gulf States this week. A few lite showers may fall across the Dakotas, but otherwise, the Central US rain totals will be limited. High temperatures range in the 70s to lower 90s which is just a few degrees warmer than normal. At this time is no evidence of any Canadian cold that would produce an early frost. Warmth across W Canada should allow for an extended 2022 Central US growing season. The extreme moisture across the Gulf States ends this week, with harvest underway after the weekend.
Cattle futures were lower to start the week after Friday’s COF report showed stronger placements than expected and the marketing numbers slightly lower than estimated, even with one fewer marketing day than last year. Cash markets are quiet in the outlook appears steady. With plans for Labor Day featuring coming up, cash markets appear to be active this week. Steady is what the trade is anticipating. The August cold storage report showed the end of July beef stocks were at 511 Mil pounds, a 27% increase over last year and a record July figure. However, this marked the fourth consecutive month that stocks were lower from the previous month. The late-season high was forged in March, and beef stocks are expected to decline into late spring or early summer of 2023.