Good morning!
Quiet overnight grain trade... Corn, soybeans and wheat held in tight trading ranges during a quiet overnight session. As of 6:30 a.m. CT, corn futures are trading mostly unchanged, soybeans are a penny lower and wheat futures are 2 to 4 cents higher. The U.S. dollar index is around 100 points lower and front-month crude oil futures are trading just above unchanged.
Cordonnier lowers U.S. soybean yield, production forecast... Crop consultant Dr. Michael Cordonnier lowered his U.S. soybean yield forecast 0.5 bu. to 52.5 bu. per acre, noting soil moisture has declined in nine of the past 10 weeks, which is detrimental to pod filling. That reduced his soybean production estimate to 4.52 billion bushels. Cordonnier kept his corn yield and production forecasts at 182.5 bu. per acre and 15.09 billion bu., respectively. He maintained a neutral to lower bias toward both crops.
Soybean CCI rating declines, corn holds steady... USDA rated 65% of the corn crop as “good” to “excellent” and 12% “poor” to “very poor.” The soybean crop was rated 64% “good” to “excellent” and 11% “poor” to “very poor.” On the weighted Pro Farmer Crop Condition Index (CCI; 0 to 500-point scale, with 500 representing perfect), the corn crop held at 368.2, while the soybean crop fell 3.0 points to 359.2. Click here for details.
Crop Progress Report highlights… Following are highlights from USDA’s crop progress and condition update as of Sept. 15:
· Corn: 65% good/excellent (64% last week); 85% dented (84% average); 45% mature (38% average); 9% harvested (6% average).
· Soybeans: 64% good/excellent (65% last week); 44% dropping leaves (37% average); 6% harvested (3% average).
· Cotton: 39% good/excellent (40% last week); 54% bolls opening (50% average); 10% harvested (8% average).
· Spring wheat: 92% harvested (90% average).
· Winter wheat: 14% planted (13% average).
France cuts wheat production forecast... France’s ag ministry cut its soft wheat production forecast by 540,000 MT to 25.78 MMT, which would be the lowest since 1986. That’s in line with most private crop forecasters, which are in the 25 MMT to 26 MMT range.
ABM: Neutral ENSO conditions likely to continue... Sea surface temperatures (SSTs) in the central equatorial Pacific Ocean and atmospheric patterns remain within ENSO-neutral thresholds. While some atmospheric indicators such as pressure, cloud and trade wind patterns over the Pacific have been more La Niña-like over the past few weeks, according to the Australian Bureau of Meteorology (ABM), though it’s uncertain if these conditions will be sustained or build. ABM says, “It is possible a La Niña may develop in coming months but if so, it is forecast to be relatively weak (in terms of the strength of the SST anomaly) and short-lived.”
Houses faces hurdles on stopgap spending bill as conservatives push for 2025 deadline... House GOP leaders are struggling to pass a stopgap spending bill needed to avoid a government shutdown as the Sept. 30 deadline approaches for the beginning of fiscal year (FY) 2025. Conservatives pressured House Speaker Mike Johnson (R-La.) to extend the spending deadline to March 2025, hoping Donald Trump will become president. Johnson also agreed to include the SAVE Act, aimed at preventing noncitizens from voting. However, he withdrew the proposal due to opposition within his party. Some Republicans oppose short-term spending deals, while others argue it could harm military readiness. Johnson is working to rally support, but the next steps remain uncertain, as Trump urges rejection of any deal without voting-security measures, which Democrats mostly oppose and the White House says it would veto.
Euro zone economic sentiment tumbles... The ZEW Indicator of Economic Sentiment for the euro zone continued to plummet in September, dropping 8.6 points to an 11-month low of 9.3. That was the third consecutive month of deterioration in the morale gauge amid ongoing uncertainty about the economic outlook and the direction of monetary policy. In September, 60.9% of surveyed analysts expected no changes in economic activity, 24.2% predicted an improvement and 14.9% anticipated a deterioration. In the meantime, the indicator of the current economic situation fell by 8 points to -40.4 and inflation expectations went up by 10.6 points to -28.5.
Beef packers still cutting in the black... The average cash cattle price firmed 93 cents last week to $182.11, ending a six-week decline. Wholesale beef prices dropped 34 cents for Choice and $2.03 for Select on Monday. While packer margins have tightened, they remain in the black, which could encourage higher cash prices again, though active trade won’t likely come until late in the week.
Traders narrow hog futures discount to cash index... October lean hog futures posted strong gains on Monday, while the cash hog index continues to decline seasonally. October hogs finished yesterday at a $4.455 discount to today’s cash quote of $83.48, which is down another 49 cents and reflects the price on Sept. 13. That suggests traders anticipate prices will continue to drop over the next month.
Overnight demand news... Japan is seeking 123,012 MT of milling wheat in its weekly tender.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
· 11:00 a.m. Feed Grains: Yearbook Tables — ERS
· 11:00 a.m. Fruit and Tree Nuts Data — ERS
· 11:00 a.m. Vegetables and Pulses Data — ERS
· 2:00 p.m. Stone Fruit: World Markets and Trade — FAS