Grain futures opened the week trading in a narrowly mixed pattern. Corn is seeing modest pressure, while soybeans and wheat are posting slight gains. Weather is a key driver this morning, as frost has been reported in parts of the Northern Midwest. Although no major freeze events have been confirmed, the presence of frost is adding fresh uncertainty to U.S. production expectations. Early frost events can negatively affect crop quality, particularly by reducing test weights, and that concern is now beginning to influence market sentiment. This afternoon, crop ratings anticipate a drop of 1-2% in the good/excellent category. The crop is maturing fast.

Additionally, the number of reports highlighting disease pressure in corn fields continues to grow, further clouding yield estimates. Alongside this, persistent drought conditions are beginning to have a broader impact. Draft restrictions are now in place on the Mississippi River, which could complicate grain movement just as harvest activity ramps up. Forecasts suggest water levels will continue to fall throughout September, raising concerns for crop transportation and fertilizer shipments heading northbound.

Looking ahead, the market’s attention is turning to this Friday’s USDA WASDE report, which will incorporate more field-based observations. As a result, positioning ahead of the report is likely to influence early-week trade. At the same time, broader economic indicators are being monitored, with a growing number of analysts warning about signs of stagnation. On the export front, last week’s uptick in flash sales was welcomed, and traders hope the trend continues. US corn sales are double that of last year. The U.S. remains highly competitive globally, thanks to a weaker dollar that supports export interest.

Over the weekend, OPEC agreed to boost oil supplies by 137,000 barrels/day to maintain market share. Futures were higher by $1.25 overnight as the estimate was slightly less than anticipated. Still, the world crude oil market will be oversupplied into the winter. We have yet to see any hurricane threats in the Gulf that would curtail production for any length of time.

Live and feeder cattle prices closed lower last week than the prior week, highlighting the loss of momentum from highs made on August 27, just over two weeks ago. Cash markets last week were generally lower as the trend in September typically is for a softer market. The cash feeder Index was down $1.42 for the week at $363.96.

Box beef values were lower last week, correcting after the seasonal Labor Day holiday. The choice cutout fell by $4.65, while select was off $4.81. Estimated slaughter margins for the week were at $186/head. Negotiated fed trade had seen the South trade steady to $1 higher at $242-243. Meanwhile, the north was softer by $2-3, with prices at $242-243. We now have an equal north and south spread.

Note that rallies are sold much more easily, rather than breaks getting bought and reversed to new highs quickly. For feeder cattle, August 27 looks to go down as the seasonal high, just past the average topping dates we show at the beginning of August. Recovery rallies look to be targeted for selling yet for a while. Both live and feeder cattle look to be playing out wave 4 setbacks on the charts.