Overnight weakness finds renewed buying interest.
Grain futures traded lower last night after US weekly crop progress data showed both corn and soybeans down 3% in the good/excellent category (near expectations) while wheat was up 2%. Morning weather models that again keep rain void of the W Midwest region through the end of this week had corn and soybeans pressing new monthly highs.
The EU crop monitoring group MARS expects 2023 Ukraine rapeseed production to be 5.47 MMT, up sharply from 3.04 MMT in April. Farmers there have increased the rapeseed planted area by 79% over 2021. France’s Farm Ministry projects 2023 sunflower and soft wheat acres unchanged from last month’s estimate, while corn is expected to be down and barley and rapeseed acres up. Updated vegetation health maps released on Monday show conditions across much of northern Europe below last year and the averages.
Market movements are being defined by rapidly adding or subtracting weather premiums based on each updated model guidance. This includes night sessions and day sessions. The West Central corn belt needs rain, and weather models need to produce a changing pattern over the next seven days.
Both the EU and GFS models are in poor agreement beyond this coming weekend, with both struggling on exactly where to place regional showers in the 6-10 day period. The EU is wetter in the Eastern Midwest, while the GFS is wetter in Nebraska and Kansas. This puts confidence low for next week’s details. An improvement in the driest areas of the Central US. IA, northern IL, and the Great Lakes which need rain eminently. The abnormally cool temps end this weekend as above normal temps return to the N Plains and upper Midwest next week.
Live cattle futures saw a recovery on Monday after three days of losses late last week, with the firm outlook offered for early trade today. Negotiated fed cattle markets are quiet, which is typical at the start of the week following the sharp cash gains seen last week. Feedlots are looking to sell for no less than steady money this week, with box beef yesterday sharply higher. Choice gained $4.50, while Select rose $4.53. Cattle futures are consolidating recent gains, with recovery rallies now being targeted as selling opportunities given last week’s weekly reversal.