A mixed grain trade after morning export sales.

Row crop prices firmed overnight on short covering, as no new discernible news was prevalent. Wheat prices gave up overnight strength when French milling wheat opened in midmorning trade and softened $1.00 MT. Export sales data this morning revealed a slow pace to the start of new year exports. This is at a time when world demand starts to shift to South America.

The January USDA Report is on Friday, with the average trade guess for yields being 174.9 bpa for corn and 49.9 bpa for beans, in line with November. Quarterly stocks estimate include corn 12.050 bbu (highest since 2018), soybeans 2.975 bbu (smallest since 2020), and wheat 1.387 bbu (largest since 2020). There is a risk that WASDE demand changes could occur to a boost in the US corn grind for ethanol, which could be anywhere from 25-50 Mil Bu, and potentially a boost to the US soybean crush due to recent pace. Also, winter wheat seedings will be closely watched, with estimates of acreage down 900,000 acres from last year.

Argentina’s Rosario Commodity Exchange raised the 2024 crop production estimate for corn to 59 MMTs, up 3 MMT from their prior forecast. They also raised soybean production to 52 MMTs, up 2 MMTs due to their favorable moisture recovery from last year’s drought.

The US CPI report showed the core CPI rising 3.9% versus an estimate of 3.8%, with the consumer price index coming in up .3% versus a .2% estimate. This lifted the US dollar from a lower overnight trade, pushing it to a positive $0.15 at 102.21. Gold and silver gave up large overnight gains but still posted a positive trade.

South American weather models have the EU solution going a bit drier across and E Brazil next week. The GFS/Canadian models are still wet; it’s not that the EU is void of moisture, it is just the driest of the models. Rainfall is forecasted to fall across N Brazil on the weekend, with the front that pushes southward across SC Brazil by Tuesday, producing .5-2.00” across the dry areas of Matto Grasso do Sul, Paraná, and São Paulo.

Live and feeder cattle prices did close higher yesterday but again well off morning session highs. Cash markets remained quiet, with light sales quoted in IA. Live cattle sold steady with last week at $175 and dressed sales were steady and $275. Box beef values showed select leading advance, gaining $4.11, while choice picked up $2.91. The choice/select spread continues to narrow and has lost $16 from the late December high. Tightening beef stocks are driving select prices higher, while seasonal slow demand for the ribs and loin primals is narrowing the spread. Feb cattle still refuses to narrow the spread to cash, as it’s concerned about the softening seasonal tendency of the trade into early February. The cash cattle trade will have to improve more to break this mentality.