October 21, 2026

Grain Overview

Corn, soybeans, and wheat traded lower again overnight as buying interest remains limited. Managed money continues to favor outside markets, particularly energy, while a lack of fresh news keeps traders away from grains. Grain futures are becoming oversold, but that has yet to attract meaningful buying. South American weather remains one potential source of support, with El Niño bringing mixed conditions to Brazil. Current dryness is helping speed along planting in the north but will become a concern if rains do not develop in November. Argentina remains mostly favorable.

The US harvest should make excellent progress this week with favorable weather. This immediate available supply being delivered has end users letting the market come to them. The White House diesel relief program could further discourage sales by easing immediate cash flow needs. The French harvest is wrapping up, and it’s a bust, with corn at 7 MMT, the smallest crop since 1976. This is half of what they produced last year. European corn imports from the US will be on the rise in the months to come.

The wheat market is collapsing on an almost certain expectation that the Black Sea grain trade will reopen, with the US envoy, which includes Stephen Witkoff, meeting with Pres. Putin for the 9th time. Witkoff and Kushner have failed in negotiations to open up the SOH from April through June and have failed several times between Russia and Ukraine. Eventually, a blind pig finds an acorn, but the opening of the Black Sea grain route continues to plague world importers of grains who are starting to seek alternative sources from beyond Europe. Egypt is now seeking another 5-6 cargoes of optional-origin basis wheat. They had a record-large domestic harvest to lean on, but now they know they have to start seeking alternative sources.

The grain trade is overwhelmed presently with a Midwest that is wide open for harvest. This doesn’t happen very often, as it was just 2 weeks ago that rain was an issue. Now everyone is moving at once. Bearish attitudes are now dominating, creating a downward price vacuum in the marketplace. In a very short time, harvest will be wrapping up for soybeans, and by early November, corn harvest will also be done. The end of harvest will find a dearth of grain movement very quickly as bin doors are locked shut. End users know it’s the feast-before-the-famine mentality, so to speak, and whether there is a large or small crop, once bin doors are closed, it takes a rally to get them opened.

It’s always darkest before the dawn, and all the grain trade is looking at right now is a crop that’s coming in, along with the shortsightedness that the price break has created a large spread between European corn and wheat values compared to the US that will direct interest toward the US to increase exports. Markets that fall precipitously like this typically create V bottoms. Farmers will lock away as much of this year’s corn crop as they can, while soybeans are always the easy selling choice. What’s interesting is how soybeans have taken on large selling over the past 2 weeks and are still near 12.50, when the bears earlier this year felt beans would never hold above 11.00. A change of trend and mentality could be just 10 days away for grains. When we flip the calendar page over, it’s amazing how attitudes change.

Cattle Overview

Late Tuesday, Sec. of Ag. Rollins announced, in a goal to bring more transparency and accuracy to price discovery, that they will update the AMS reporting of cash cattle. Because of the continuing decline in cash negotiated trade, the number of reported transactions has also declined, which limits confidence due to the limited number of trades. Starting next Monday, the AMS will begin using aggregated data from Colorado, Texas, New Mexico, Oklahoma, and Kansas.

Yesterday’s cattle trade saw further sharp gains as the trade convinces itself that we are going to have a very friendly COF report Friday afternoon, which, of course, brings about the risk that it might not be. Feeder cattle placements are again targeted in the 92-93% range of a year ago. Also, the precipitous break in corn continues to pump optimism into the feeder trade as an extra price kick.

Tuesday slaughter was estimated at 112,000 head, which was 2,000 more than last week and 4,000 head less than a year ago. Meanwhile, boxed beef prices in the afternoon had choice gaining $1.72 to $373.30, while select was also higher by $1.63 at $361.54. Movement was decent at 98 loads, with 61 choice, 11 select, 16 ground beef, and the rest trim. Average carcass weights are being reported at 897 pounds this week, and that’s a 9-pound gain from last week and 13 pounds higher than last year’s heavy cattle.

It’s noted that packers are running a slightly more aggressive slaughter speed and will likely want to secure more inventory, which keeps optimism that cash trade will be steady, if not better again this week. December cattle are eyeing the 50% retracement of the summer decline at 233 as a target. Support on setbacks is in the 226.50-227.50 range.

Cash feeder cattle around the country are now seeing light calves trade sharply higher, while the heavier weights continue to see gains. Yesterday’s index did slip $1.29 and was at $342.16, which the October feeders have raced past. We’ll see what today’s index comes in at, but it will likely see an improvement.

January feeders are the active trading contract and have almost tagged the 344 target I have talked about considerably as a minimum expectation for “C” wave rallies that match the prior leg higher. Extensions of this rally past the target are usually not the exception but typically can be the rule. Upside resistance at the 78% retracement values is still another $5.00 higher on the January and March contracts. Friday’s COF data will have a harder time being bullish now, given recent strength. Even a friendly report could bring selling back into the trade on Monday with a ‘buy the rumor, sell the fact” mentality.

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