Grains trade lower on a better 6-10 day forecast.

Wheat futures continued their drift lower overnight, with corn and soybeans tumbling in the morning hours as the overnight trends for the 6-10 day forecast offered a cooler than normal weather and additional rainfall chances. Wetter areas include southern IA and southern NE. Further north in the Upper Midwest (MN) is lighter and more sporadic.

Ukraine’s and Turkey’s Presidents will meet later today to discuss the Black Sea grain corridor and a potential prisoner swap with Russia. While Russia continues to lament Western sanctions hurting exports, the country shipped a record 60 MMT of grain over the past year. The Black Sea Grain Corridor deal expires on July 18th.

The June non-farm payrolls came in this morning a touch weaker at 209,000 as opposed to an increase of 240,000. The unemployment rate moved to 3.6% from 3.7%.

South American corn basis bids continue to rise. September Brazilian FOB corn is offered at $0.45 over Chicago versus the US Gulf at $0.51 over. This 6-cent/Bu difference is the narrowest that US/Brazilian corn has been this year. Argentine corn premiums have followed Brazil, and the CBOT does not need lower prices to encourage exports. Large export demand in Brazil has seen soybean oil basis jump 2.5-4 cents amid record large export demand. Brazilian FOB soy oil is offered at $0.14 under Chicago in September, with US Gulf offered at $0.10 over.

Monday’s expectations are that crop ratings may only improve-1-3% with the WASDE July crop production numbers out on Wednesday, July 12. Becoming widely anticipated, the USDA will lower yield expectations to prior records of 177/BPA, with some anticipating, based on ratings, they may even lower to 175 BPA. Soybeans are anticipated that they will be at least lowered to 51 BPA in the report. Now it’s a matter of the balance sheets and what the USDA juggles exports and usage at to produce the carryout.

The major forecast models are drier across the southern Midwest and Eastern Plains and what was offered in prior days in the 1-5 day period with better rain in the 6-10 day forecast. The models are struggling with Ridge riding systems and the location amounts of rain. This morning there are storms located over the Central Plains, which include rain for NE/KS. Near to slightly below normal rainfall is forecast for the Midwest, with cool temperatures for the next 6-8 days followed by warming after July 18.

Cattle and feeder cattle futures traded lower yesterday, with a mixed outlook offered this morning. Live cattle finished in negative territory but were near session highs at the close, while feeder cattle fell $2-three as corn prices rallied. Cash trade on Thursday was $1 lower in TX at $178 and steady from last week in the KS area at $178. Live sales in IA/MN were quoted at a wide range of $179-184 or were $3 lower to $2 higher.

Slaughter data for the week of June 24, show the average steer carcass weight gained a pound for the week at 883 pounds. The average weight was unchanged a year ago after being above 2022 in the previous four weeks. The one-week uptick is not enough to call a seasonal low in carcass weights, but the odds favor that a low in weights is close at hand. Since 2010, Steer weights have, on average, bottomed out in late May, but in three of the last four years, the low has been scored in June. August live cattle have narrowed their distance between the cash market to within $4. The next six weeks are typically slow for domestic demand, and prices often slump. Any fresh rally here forward needs to be led by the cash market.