The November WASDE crop report is out today at 11:00 a.m.

This morning’s grain trade is lower across the board ahead of the November WASDE crop report, as wheat producing the biggest retreat despite the recent Russian attack on a civilian vessel. Ukraine’s Deputy PM said that the “alternative” Black Sea route will continue to operate. Six vessels loaded with Ag exports have left Odesa headed to Turkey’s Bosphorus Strait.

Brazil’s CONAB monthly update showed 23/24 soybean production increasing from 162.003 MMT to 162.42 MMT and 23/24 corn production decreasing from 119.404 MMT to 119.066 MMT from the October report. CONAB did state that bad weather will require Mato Grosso to replant soybeans, but no percentage was offered. Brazil’s corn export program is coming to a seasonal end, which will shift demand to the US for the next several months.

Today’s crop report is primed for a surprise, as today’s yield guesses are almost unchanged from October, and the yield guesses are almost equal to last year’s. This statistical anomaly typically never occurs, so look for potential fireworks at 11:00 a.m. when the data is released. The current estimate is 173.2 BPA for corn yield and 49.6 BPA for soybeans.

The US ag attaché for India lowered their 2023 wheat production estimate to 106 MMTs, compared to the WASDE’s current forecast of 113.50 MMTs. The WASDE forecast of India's domestic annual wheat demand is at 108.1 MMTs with ending stocks of 14 MMTs using their current 113.5 MMT crop. The 7.5 MMT cut Indian 23 production will be important to help explain why Indian domestic wheat prices keep rising.

The north and central Brazil weather forecast remains hot and dry and maintains that through November 23. A high-pressure Ridge holds across Northern Brazil with fans the hot/dry weather while a low-pressure trough and fast-moving jet stream that promotes excessive rain across the south in Río Grande do Sul in Santa Catarina with totals of 3-8.00” of unneeded rainfall. The 12-15 day forecast offers a return of some showers in northern Brazil, but confidence is low as numerous opportunities in the last 45 days have shown the same prospect. El Niño has a locked-in weather pattern that does not seem to want to break.

Live and feeder cattle prices tumbled sharply yesterday morning but found support as December cattle held the 200-day MA, and a sharp reversal occurred with higher closes. A firm outlook is offered this morning, with futures looking to start another recovery bounce technically. Meanwhile, negotiated fed cattle was quiet on Wednesday on limited demand. Some feed yards may be willing to move cattle at $1-2 lower, picking up a couple of dollars on a basis, but otherwise, active trade is anticipated to wait until Friday. Box beef was lower, with the choice down $1.63 and back under $300, while select gained $1.55.

Yesterday’s lows on live cattle touched key technical support levels for a bullish uptrend and held. Further renewed buying is needed to confirm a potential low is in. November is not known for strong cattle rallies, but once we get Pearl Harbor Day, from December 7 into the end of the year is a very strong up-price seasonal for cattle with the advent of holiday purchasing for corporate and private Christmas parties and hedge unwinding for tax purposes on December 31.

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