Wheat futures are trading at a three-week high.

Grain futures are firmer this morning, led by double-digit gains in the wheat market. The French Ag Minister reduced their 2024 French wheat crop estimate to 26.3 MMT, down 25% from last year and the smallest French wheat harvest since 1986. Private French wheat crop estimates have the crop at 25-25.5 MMTs, with a substantial portion of the crop being feed wheat quality rather than milling wheat. The French wheat harvest has advanced to 88% complete, and just 48% of the crop is rated good/excellent.

The Germans are also struggling with similar cool/wet weather and are reporting sizable yield and quality losses with private all EU all wheat crop estimates in sharp decline in estimated in a range of 121-123 MMTs, which is well down from the July USDA forecast estimate of 130 MMTs. The year on year European/Black Sea wheat export losses are mounting. Wheat exports for EU 2024 25 wheat is likely near 28 MMTs, down from July WASDE forecast of 34.5 MMTs. Meanwhile Black Sea wheat exports are already forecasted to be down 12.5 MMTs.

The Russian Spring Wheat harvest normally starts next week, but excessive rainfall will delay it and is starting to cause concerns to Russian wheat exporters. Russian spring wheat areas have endured 200-300% of normal rainfall in the past four weeks, and a wet forecast for the next ten days is included.

Algeria has purchased 600-700,000 MTs of optional origin wheat for October, with the supply to be sourced from the Black Sea or Bulgaria. Egypt’s tender for 3.8 MMTs of world wheat on Monday will cover their import needs through April. Russian FOB wheat is bid at $221/MT and offered at $223.

World crop production problems continue their decline with losses in the Black Sea, Europe, and China. Single-handedly, the big US crops are producing the bearish pulling grain values domestically. On Monday, the first definition of the size of the US 2024 crop will be given. Despite average estimates, the grain trade is trading a 183 BPA corn crop and a 53 BPA bean crop. The true important number on Monday is not yield, but total production when the FSA averages in acreage losses to preventive plants and potentially lower harvestable acres in corn due to poor stands in some areas of the northern Midwest.

Ridge-riding thunderstorms look to slowly return to the central US area as the remains of Debbie push northeasterly into the Maritimes of Canada through the weekend. Ridge-riding thunderstorms also return to the Plains this weekend, and the storms will be in the Midwest early next week. Some of the rains also move into the Tennessee Valley. The Central and Eastern Midwest holds a drier weather trend.

Live cattle and feeder cattle were lower on Thursday, with feeder cattle marking the sixth lower closing day with a soft outlook offered for this morning. September feeder cattle slipped to new lows yesterday and are now the cheapest since last December. Cash trade for Thursday was like earlier week quotes, with live sales in the north continuing at $193, which is $3 lower, and dressed trades were off $5 at $305. Meanwhile, in the South, live sales were $one-to lower at $186-187. Northern cattle continued to collect a $8 premium to the South, which is similar to last year. However, those premiums will likely narrow in the coming weeks with the northern market trade even with the South in the fourth quarter.

Cash sales this week were significantly above the October futures. The market is fearful of another counter-seasonal fourth-quarter correction, similar to last year. Feeder cattle continue to search for demand, but a strong recovery and deferred live cattle will be needed to lift feeder cattle futures.