Grain prices find stability heading for the weekly close.
Today’s grain trade is mostly firm towards the end of the morning session, with export sales data released as expected. This morning’s Stats Canada data had all wheat stocks for July 31 at 3.584 MMT versus estimates of 4 MMT, canola was 1.506, also below estimates of 1.7 MMTs, and oats were close with an estimate of 1.2 coming in at 1.275 MT.
Open interest for the week increased as prices declined for grains. This shows new speculative selling since Labor Day has been rising. Soy oil on Thursday showed open interest, gaining 7,676 contracts in its decline while crude oil continues to rise.
The NASS/WASDE crop report will be released on Tuesday at 11:00 a.m., carrying the government's first small objective yield guesses. Some test weights were sampled with 13-15% of the crop mature. The tension comes down to Monday will the bean yield go under 50 BPA this early in the season, and will corn be closer to 170 BPA? Also, increases in increases are anticipated, along with the slash in exports if yields are lowered substantially.
Australian and Argentine weather forecasts call for limited rain for another 10 days. The wheat crop is being impacted in Australia with spring sewing for summer row crops still yet weeks away. September is a period when weather is the biggest concern for Australia along with Argentine wheat which currently is in need of immediate rainfall, or a sharp yield reduction will occur.
The central US forecast has seasonal temperatures for the next two weeks with below-normal rainfall. There is no evidence of a return to excessive heat through the Central US or normal rainfall. Soil moisture levels continue to decline having a significant impact on the finish of the summer row crops. Corn and soybean sizes are being adversely impacted by the dry and hot end of the growing season.
Live and feeder cattle enjoyed a sharply higher price movement on Thursday, with a steady outlook anticipated for this morning. A small number of cattle in the north reportedly sold at $183-186 which is $1-3 of the last week and sparked the sharply higher move. Dressed trades were nearly steady at $2 90. The Packers did not pick up much inventory at those prices with asking prices still above yesterday’s trade. February live cattle scored a new contract high and closed back below the July high, while April 2024 cattle made new contract highs and held them into the close
Beef cow herd liquidation began to slow early this year, and slaughter rates have been on either side of the five-year average since March. Since early July, cow slaughter has been below average, and the cumulative slaughter rate has drifted further behind last year. There have been eight years that the cumulative slaughter was larger than 2023, however, the January 1 beef cow herd was record low in cumin to slaughter as a percentage of the inventory and is still the second largest on record.