The grains were mostly firm until the 7:30 US Jobs Number firmed the dollar.

This morning’s grain trade had a firm bias led by the wheat market (until the Jobs number at 7:30) on hopes that Chinese purchases of French wheat continue to circulate along with Egypt likely to be in soon if they can get their financial package from the IMF/World Bank. Egypt is anticipated to get a $10 Bil loan to cover their government budgetary shortfalls through 2025 (think about it, the US government spends $16 bill/day, and $10/Bil gets Egypt through 2025). Egypt has hiked its bank interest rate by 2%, which is 21.25% as of today, which could reflect greater flexibility in the pricing of the Egyptian pound, which is trading in the black market at 60-65 pounds/$1 US versus the government rate of 31/$1 US.

The US Non-farm Jobs numbers came out at 7:30 in the morning, and it came in hot, which pressed the dollar higher and caused the commodities to soften from what was a from overnight trade. The jobs number was 350 3K versus an estimate of 180 5K, and unemployment was estimated at 3.8%, and it went lower to 3.7%. The US dollar firmed back higher to the 103.50 range on this data.
US soybean crush and corn ethanol margins are profitable, with end-users seeking forward supply. Central Illinois cash bids are at 23-$0.25/Bu over March futures, with corn trading at 7-9 cents over. This is well below the autumn highs but still reflects a desire to find grain from tightfisted farmers with stored cash grain.

Argentina released its crop condition ratings yesterday, and the corn and soybean ratings declined from the good/excellent category. Corn was down 8% due to recent heat/dryness. The ratings are still well above last year’s drought ravaged crop but are drifting and need soaking rain that is in the forecast for late next week to prevent a deepening yield fall. Private soy and corn crop estimates continue to decline for Brazil, and it is important for Argentina to maintain corn/soy crop ratings to offset.

Yesterday’s December soybean crush reported by NASS came in at a record 204 Mil Bu. This was up 17 Mil from last year. The massive new biofuel refiner from Phillips 66 in Rodeo, CA, is set to start renewable diesel production in March.

High temps will be in the upper 90s/lower 100s across Argentina currently and through this weekend, with the western half of Buenos Aires being mostly at 100 or higher. This heat carries into next week. It’s imperative that the GFS rain models for rain February 8-12 arrive but rains this time are expected in the .25-1.50” across Argentina. After the rain event, there is a return of above-normal temperatures with dryness. Argentina is on the watchlist.

Live and feeder cattle prices closed sharply higher on Thursday, with a steady outlook offered this morning. The Cattle Inventory Report is out of the way and allowed hedges to be lightened up while exuberant buying resumed on the numbers. Further strength day will require a new spark, as you have to feed a bull every day. Watch for Friday profit taking to be more of the trade then further press to new highs.

Negotiated fed cattle markets were active, with live sales in the South at $178-179, which was $3-4 higher. The North was at $176-178, which was steady at $2 higher, with dressed sales of $3 at $280. Steer carcass weights in the fourth quarter were from backed-up supplies in September. The weekly average weight peaked in late December at a historic 942 Lbs. The average weight for the week ending January 20 was down to 918 pounds, just 3 pounds heavier than a year ago due to the January winter stress. Seasonally, weights continue to decline into the end of the second quarter.