Good morning!
Grain prices mixed overnight… As of 6:00 a.m. CDT, December corn was steady, November soybeans down 3 1/2 cents and December winter wheat futures markets were 1 1/4 to 2 1/2 cents higher. Grain traders today will closely examine the weekly USDA export sales report, with a keener eye on any new China purchases of U.S. grains. The corn market has pulled out in front to lead the grains and soy complex futures, all of which appear to be in better shape than they were a few weeks ago, especially corn. Grain traders will be eyeing early corn and soybean harvest yield reports coming off the combines. The key outside markets today see the U.S. dollar index near steady. Nymex crude oil prices are a bit weaker and trading around $64.00 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.05 percent.
Midwest weather to remain unstable… The National Weather Service today reported an upper-low over the central U.S. will continue to bring chances for showers and thunderstorms through the next few days. For severe weather, the Storm Prediction Center has a marginal risk for severe weather centered from Oklahoma into Missouri today. The main weather hazards should be some hail and perhaps a strong wind gust or two. Otherwise, Friday and Saturday should continue to see general scattered thunderstorms across the Midwest, with some heavy rains possible. The Ohio and Tennessee Valleys will be particularly warm with high temperatures in the lower to middle 90s. Most of the country will be 5 to 10 degrees above average in high temperatures. The Southwest will see below average temperatures with increased clouds and rainfall. A backdoor cold front into the Northeast will bring afternoon temperatures back into the 60s and 70s this weekend.
Deeply divided FOMC cuts by 0.25%... The Federal Reserve’s FOMC cut its fed funds trading range by a quarter-point, to 4.00 to 4.25%, Wednesday afternoon, as widely expected. However, the committee members are deeply divided on what to do about a slowing U.S. economy. The decision to cut rates was nearly unanimous among FOMC members, however, with the lone dissent coming from Fed Governor Stephen Miran, who favored a larger rate reduction. Fed policymakers are split over the outlook for interest rates. Fed Chair Powell said the Fed’s job would get more difficult as policymakers face difficult trade-offs in considering whether to keep cutting rates, with some officials concerned about inflation and others concerned about the labor market. Powell faced pointed questions from the press about Fed independence, given Miran’s dual role on leave from the White House’s Council of Economic Advisers. Powell reiterated the central bank’s commitment to its nonpartisan mandate: “We’re strongly committed to maintaining our independence… It is deeply in our culture to do our work based on incoming data.” Major U.S. banks—JPMorgan Chase, Citigroup, Wells Fargo, and Bank of America—cut their prime lending rates from 7.50% to 7.25% following the Fed rate cut.
China stock market rallies on Fed rate cut, U.S.-China trade hopes… China’s Shanghai composite stock index rose 0.2%, while the Shenzhen component added 0.5% Thursday, with mainland benchmarks touching fresh multi-year highs and tracking global stock-market gains after the Federal Reserve delivered a quarter-point rate cut Wednesday, as expected. Risk appetite was further lifted by optimism over U.S.-China trade negotiations and a potential TikTok agreement, with President Trump and President Xi Jinping set to speak Friday.
NCGA survey: Growers believe U.S. farm economy may be in crisis… An overwhelming majority of corn growers from across the U.S. says the nation’s farm economy is possibly already in a crisis or on the brink of one, according to a survey released Wednesday by the National Corn Growers Association. The findings were released during an NCGA-sponsored economic roundtable in Washington, D.C., where experts stressed the seriousness of the economic problems facing farmers. During the discussion, NCGA leaders said Congress could alleviate some of the pain by passing the Nationwide Consumer and Fuel Retailer Choice Act of 2025, which would remove an outdated provision in the Clean Air Act that restricts the summertime sales of fuel with 15% ethanol blends, often referred to as E15. “Farmers are in a lot of economic pain right now” said Illinois farmer and NCGA President Kenneth Hartman Jr. “It’s a four-alarm fire in the countryside, and we need members of Congress to act fast to remove barriers to markets. Passing legislation for the year-round, nationwide sale of higher blends of ethanol would be an important first step in addressing this problem.” Corn growers visited Capitol Hill this week to highlight their economic concerns and to call for action on the E15 legislation.
Malaysian palm oil futures prices dip… Malaysian palm oil futures fell below MYR 4,450 per MT Thursday after slight gains in the prior session, weighed by further losses in rival oils on the Chicago market following a U.S. biofuels proposal that disappointed traders. Sentiment was also cautious amid a shortened trading week and ahead of Malaysia’s August trade data, due in the coming days. Meantime, last week’s industry figures showed end-August stocks rose 4.2% from July to 2.2 million MT. Capping further declines, demand from India, the top buyer, is expected to stay strong. The country’s palm oil imports surged 15.8% in August to 990,528 MT, the highest in over a year, as attractive pricing against soyoil prompted refiners to stock up ahead of the mid-October festive season.
Cattle futures markets starting to trend lower… The live and feeder cattle futures markets bulls are fading fast late this week as prices are now starting to trend down on the daily bar charts, amid deteriorating cash cattle and beef market fundamentals. Cattle market bulls are hoping Friday afternoon’s USDA monthly Cattle-on-Feed Report will be price-friendly and remind cattle traders of the still-tight feedlot cattle supplies. Very light cash cattle trading has been reported by USDA so far this week, at an average of $240.00. Last week’s cash cattle trade averaged $239.33, down $3.22 from the previous week.
Lean hog futures market sees chart consolidation… The lean hog futures market saw some normal backing and filling on the charts Wednesday, after hitting a contract high Tuesday. Gains in hog futures Wednesday were again limited by a sell-off in the cattle futures markets. The near-term technical posture for October hogs remains firmly bullish, which is keeping sellers scarce at present. The latest CME lean hog index is down 14 cents at $106.00. Today’s projected cash hog index is down another 14 cents at $105.86. Wednesday’s national direct 5-day rolling average cash hog price quote was $105.99.
USDA reports today—Thursday
-- Weekly Export Sales
-- Food Expenditure Series
-- Livestock, Dairy, and Poultry Outlook
-- Sugar and Sweeteners Outlook
-- Slaughter Weekly
-- Hop Stocks