September WASDE crop report out at 11:00 a.m. today.

Today’s grain trade is soft on exceptionally low volume overnight ahead of the September WASDE crop report out at 11:00 a.m. this morning. Again, the average estimate for today’s yield guess on corn is 173.4 BPA while soybeans are at 50 BPA. Interestingly, both yield guesses are slightly above last year's, while the current crop ratings are below last year's. 2023 was far drier across NW and NC Midwest regions than last year. The August 15-September 10 moisture was almost non-existent for a decent fill in the dry areas. Note that 60% of the production comes from the dry region.

China’s ag ministry raised their 2022/23 key grain import estimates. They raised the soybean import estimate by 4.66 MTs to a record large 99.86 MMTs. Corn as well, for the 2022/23 season, was increased by 500,000 MTs to 18.5 MMTs. Large vessel counts show a 6.5 MMT discrepancy between what China will import in the 2022/23 crop year and what will be pulled forward into 2023/24. China has been and continues to be on a buying spree in the world soybean in feed grain markets despite any conversation of a struggling economy.

World weather continues to show troubles for Australia, Argentina, and Northern Brazil, with limited rain for the next two weeks. The wheat crop is being impacted in Australia and Argentina, while the early soybean seeding across Northern Brazil is being delayed. In the meantime, the wheat crop in southern Brazil is being inundated with mammoth amounts of rain of 4-10 inches last week and is now again being repeated this week. Brazilian wheat exports could come to an end as it will be relegated to feed quality for livestock.

Yesterday was another day of higher price values for live cattle and feeder cattle, with only the October and December cattle not making new contract highs. Negotiated live trade is likely delayed until later this week, with sellers asking for higher cash prices. Box beef was lower at the start of the week, with choice cutout losing $279 while select slipped $0.61. September is seasonally slow for domestic demand, and box beef values are expected to correct deeper yet this month.

Economic data that will affect consumer demand is CPI Inflation data tomorrow, with the market expecting +3.6% vs. +3.2% last month. A stronger CPI equates to a stronger Dollar. PPI Inflation data on Thursday, the market expects 1.3%.