Short covering the overnight feature in the markets.

Grain futures rallied overnight as the commodity/equity world recovered from Thursday’s risk-off session. The yield on the 10-year note reached just under 4.5% from the results of the hawkish comments from the Federal Reserve on Wednesday that rates will be higher for longer. This refocused the marketplace on reduced demand and the prospects of the Fed pushing the economy toward recession.

A ship carrying 17,000 MTs of wheat for Egypt again left the Ukrainian port of Chornomorsk after a much smaller ship with 3000 MTs left earlier this week. · Ukraine’s Deputy PM said three new cargo ships are on the way to Ukraine’s Black Sea Chornomorsk and Pivdennyi sea ports for food export cargos that will deliver 127K MT of Ag products and iron ore to destinations in China, Egypt, and Spain. Russia has not newly attacked or offered comments on Ukraine’s functioning western ports.

Brazil’s total corn growing area will downsize for the first time since 2017 due to negative margins, with production down -13% compared to the previous year. Crop scientists at a top Mexican university showed progress in developing hybrid corn varieties to obtain yields needed to help offset US GMO corn imports that may be subject to future bans. The goal is to replace 6 MMT of the 18 MMT of US yellow corn.

Rainfall arrives this weekend across the N Plains and the W Midwest with accumulations estimated in a range of point 5-2.00”. The wet weather expands over the next 36 hours and moves eastward. Forecasts are not as wet as indicated in prior days, with a good portion of the E Midwest being dry enough row crop harvest this weekend and most of next week.

Russia and Australia’s wheat growing areas are forecasted to have deepening drought, with the Aussies getting record heat. Northern Brazil is seeing record heat currently and absolute dryness. There is the prospect of scattered showers with accumulations of .50” at the opening of October, but then dryness returns to the 11-15 day window. The delay in the timing of planting the soybean crop will affect the future production of safrinha corn in the spring.

Cattle futures have been lower 3 out of the last 4 days from fund liquidation across the financial and commodity markets this week. Cash cattle trade Thursday was limited to the north, with trade quoted steady on Wednesday and $2 higher from last week at $186. Dressed sales remain steady at $292. Light sales in the South were steady with last week at $183 while asking prices still remain 2-3 higher at $185-186. The September Livestock Slaughter report showed August cattle slaughter was down 6% from last year. The fed kill was down 6%, the beef cow kill was 16% later, and the dairy cow kill rose 4%. Commercial beef production was down 6% from last year’s record large August production and was slightly below the five-year average.

Cattle on Feed Report at 2pm CT, estimates include On Feed 98% of last year, Placements 95%, and Marketings 94%.