Wheat maintains strength in the overnight session.
Grain futures are mixed again this morning, with wheat pacing the advance while soybeans soften. Weakness in the wheat trade in the night session switched overnight despite some potential rain in Southwest Russia a week from now, as overnight rains for Kansas were missed, and there was renewed frost overnight in Poland/Germany/Switzerland/France. Temperatures are rising in southern Russia following two months of very little rain, causing concern among wheat traders. The Black Sea region looks completely dry into the first week of May.
Soybeans are softer as the Argentine soybean harvest gains speed. Buenos Aires Grain Exchange pegged Argentina’s corn harvest at 19.8% complete vs. 17.2% last week. The soybean harvest is 25.5% complete vs. 13.9% last week. BAGE estimates Argy corn conditions 17% G/E vs 20% G/E last week. Soybean conditions are 30% G/E, unchanged from the previous week.
In Europe, it was another cold night with frost noted in four countries, while it has been an overall week of cold temperatures with blooming rapeseed crops enduring the most harm. Rape pods abort on the frost, but bees that are needed for pollination have been inactive. Estimates are anywhere from 10-30% cuts in EU rapeseed yields, with the 24 EU rapeseed crops being lowered by 3-4 MMTs. This tightens global veg oil supplies.
One bright spot developing for US exports is the Panama Canal, which has seen better seasonal rainfall. The canal authority is expected to allow 32 vessels to sail daily versus 24. This will lower costs and provide an opportunity for better US grain exports to SE Asia on reduced costs.
There were just a few isolated showers noted across SW Kansas with totals less than ¼ of an inch, but the coverage of rain was also no better than 20% and is considered a storm bust. A secondary frontal pass will occur later today, but the best chance for meaningful Kansas rain does not occur until after May 7, which is too far out to have any confidence. Isolated rain is the best that can be expected for W Kansas next week. A second storm system looks to produce soaking rains across the Midwest next weekend.
Yesterday was an extremely volatile session, with prices closing near the best level of the almost 5-dollar range in June cattle. Cash cattle continued to trade on Thursday as price trends improved in the north; live sales in the north were $2-3 higher for the week at $185-186, with top prices paid in the IA-MN region at $187. Dressed sales rose $2 for the week at $294.
The April Livestock Slaughter report showed that commercial cattle slaughter was down 4% from February, the same number of business days, and was 15% less than a year ago with two fewer days. The per day slaughter will still be 6% less than last year. The average carcass weight was 23 pounds heavier than a year ago, but beef production was still 12% later. First quarter beef production was down 4% and at a five-year low and five Mil pounds under the April WASDE forecast. After successfully holding and absorbing bearish news in the lower 170 range, June live cattle's next target now becomes $180.