GRAIN CALLS
Corn: 6 to 8 cents higher.
Soybeans: 17 to 19 cents higher.
Wheat: 8 to 12 cents higher.
GENERAL COMMENTS: Grain and soybean futures rose overnight, tracking a rebound in equity and crude oil markets ahead of the three-day holiday weekend. Malaysian palm oil futures fell 2.3% and closed near a one-month low as new Covid lockdowns in China fueled demand concerns. Front-month crude oil futures are up around $275. U.S. stock index futures signal a stronger open, while the U.S. dollar index was down around 400 points.
Grain and livestock markets will observe normal trading hours today ahead of the extended holiday weekend. All markets and government offices are closed on Monday, Sept. 5, for Labor Day. As a result, there will be no Pro Farmer market reports and commentary. Grain markets reopen at 7:00 p.m. CT on Sept. 5 for overnight trade, while livestock markets will resume trade at 8:30 a.m. CT Sept. 6.
U.S. employers hired slightly more workers than expected in August as non-farm payrolls increased by 315,000 jobs, the Labor Department reported. Economists polled by Reuters had forecast payrolls increasing 300,000. The unemployment rate increased to 3.7% from 3.5%, but the data likely keeps the Federal Reserve on track to hike its benchmark funds rate another 75 basis points later this month.
Chinese firms have booked at least 40 cargoes of soybeans from the U.S., Brazil and Argentina in the past two weeks alone, Bloomberg reported, citing people familiar with the transactions. The purchases are to take advantage of improved processing margins, and to rebuild stockpiles ahead of Chinese festivals that run from the autumn through to the Lunar New Year, said the people. Most of the cargoes are for loading in September and October, although some have been booked for next year, they said.
Commodity brokerage StoneX lowered its U.S. corn production estimate to 14.168 billion bu. on a yield of 173.2 bu. per acre, down from 14.417 billion bu. and 176.0 bu. per acre in early August. StoneX raised its soybean crop estimate to 4.515 billion bu. on a yield of 51.8 bu. per acre, up from 4.490 billion bu. and 51.3 bu. per acre previously.
The Biden administration is expected to announce a rule this year that would detail annual biofuel blending mandates for the refining industry for a three-year period instead of just for one, Reuters reported, citing sources familiar with the discussions. The switch to a multi-year target would be aimed at providing longer-term certainty to the refining and biofuels industries, which have battled over the annual mandates since they began more than a decade ago.
The UN Food and Agriculture Organization (FAO) global food price index dropped 1.9% in August – the fifth straight monthly decline but it was still 7.8% above year-ago. All five subindexes declined in August. Compared to year-ago, prices are up 8.2% for meat, 23.5% for dairy and 11.3% for cereal grains, while vegoils are down 1.6% and sugar is 8.4% lower.
FAO slashed its 2022 global cereal grain production forecast by 17.2 MMT from last month to 2.774 billion MT amid “persistent drought conditions in northern hemisphere countries.” FAO now forecasts 2022 global cereal grain production down 38.9 MMT (1.4%) from last year.
Brazil exported 6.2 MMT of soybeans in August, according to official data published by the Brazilian government on Thursday, down from 7.5 MMT in July and 6.5 MMT last year. Brazilian corn exports jumped to 7.6 MMT last month, up from 4.1 MMT in July and 4.3 MMT in August 2021.
Russia’s wheat export tax for Sept. 7-13 will be 3,368.9 rubles ($55.89) per MT based on an indicative price of $329.30. That’s down from a rate of 4,053.8 rubles per MT the previous week.
China will auction another 500,000 MT of imported soybeans from state-owned reserves on Sept. 9. China continues to hold the weekly auctions to boost supplies on the domestic market.
CORN: December corn overnight reached $6.66 after dropping 12 1/2 cents Thursday and are up slightly from $6.64 1/4 at the end of last week.
SOYBEANS: November soybeans overnight rose as high as $14.17 3/4 after sinking 27 3/4 cents Thursday to a two-week low. The contract is still poised for a sharp drop from $14.61 1/4 at the end of last week.
WHEAT: December SRW wheat overnight rose as high as $8.09 1/2 after tumbling 37 1/4 cents Thursday to a one-week low. The contract is up slightly from $8.05 1/4 at the end of last week.
LIVESTOCK CALLS
CATTLE: Steady-weaker
HOGS: Steady-weaker
CATTLE: Live cattle may face pressure from an eroding cash market and expectations for slower demand after the Labor Day weekend, which marks the unofficial end of the summer grilling season. Choice beef cutout values fell 27 cents Thursday to $258.07, the lowest since mid-May and an apparent reflection of the usual late-summer retailer shift from steaks for grilling to a fall/winter pattern featuring more roasts. But even with the drop in wholesale beef prices, packer margins remain in the black and market-ready supplies of Choice-graded beef are tight, which should limit any extended slide in cash prices. USDA-reported live steers averaged $142.78 through Thursday morning, down $2.01 from last week’s average.
October live cattle rose 22.5 cents Thursday to $142.80, down from $143.05 at the end of last week.
HOGS: Lean hog futures may face pressure from a continuing slump in cash fundamentals. The national direct cash hog price fell another $5.06 Thursday, while the CME lean hog index is down another $1.36 to $106.26 (as of Aug. 31), near a three-month low. Falling cash prices are limiting buyer interest in fall- and winter-month futures despite bigger-than-normal seasonal discounts already built into those contracts. Pork cutout values dropped $1.33 Thursday to $101.86, the lowest daily average since May 16, but movement was stronger at 328 loads.
October lean hogs rose 42.5 cents Thursday to $91.95 and are up from $90.65 at the end of last week.