GRAIN HIGHLIGHTS: Top Stories of the Day

TOP STORIES:

Wheat Lower as Rain Hits Parched Growing Areas

Wheat for December delivery fell 2% to $6.20 a bushel on the Chicago Board of Trade Monday, amid reports of rainfall hitting the U.S. Plains and Russia over the weekend into this week.

Wheat futures trading on the CBOT led the way lower Monday, due to rainfall coming to parched growing areas worldwide. "[Wheat is] down overnight as Southern Plains are due to receive good moisture and the extended forecast has rains coming for Russia," said Marex Spectron. "We have been saying for some time that it doesn't take much rain in order to get a crop established pre winter, and if these rains eventuate much of the dryness story goes away with it."

USDA Confirms Farmers Paid $7B in Aid -- Market Talk

14:13 ET - US farmers have received over $7B in aid as part of the second round of coronavirus-relief payments, the USDA says. "America's agriculture communities are resilient, but still face many challenges due to the COVID-19 pandemic," says Agriculture Secretary Sonny Perdue. "These payments directed by President Trump will continue to help this critical industry recoup some of their losses from ongoing market disruptions and associated costs." Farmers say aid payments from the US government have been an important cushion keeping many from otherwise declaring bankruptcy. According to the USDA, the Farm Service Agency has approved more than 443,000 applications, with the top five states for payments being Iowa, Nebraska, Minnesota, Illinois and Kansas. (kirk.maltais@wsj.com; @kirkmaltais)

Profit Taking Drives Grain Futures as Covid Spreads -- Market Talk

13:50 ET - Grains lose ground on the CBOT, with corn and wheat trading down from recent multi-year highs as traders lock in profits, says AgResource. For corn in particular, something new needs to develop in order to launch prices higher, says the firm. "US corn futures need to confirm fresh China demand for the next rally leg," says AgResource. " Any Covid-19 pandemic worsening would impact corn and US ethanol on reduced US driving." The seven-day average of new coronavirus cases hit an all-time high of 68,767 cases in the US today, creating negativity across macro markets. (kirk.maltais@wsj.com; @kirkmaltais)

STORIES OF INTEREST:

Chinese Demand Supports Soybeans -- Market Talk

11:32 ET - While corn and wheat futures on the CBOT are firmly lower, soybean futures are only off 0.2%. One factor providing support for soybeans are signs that export sales to China are still strong. Grain export inspections for US soybeans totaled 2.66M metric tons, with 2.02M tons being inspected for exporting to China. Mexico, by comparison, scored a distant second with 103,231 tons being inspected. "Big bean shipments to China," commented Terry Reilly of Futures International. (kirk.maltais@wsj.com; @kirkmaltais)

Brazil Soybean Planting Advances Quickly, Helped by Rains -- Market Talk

0830 ET - Brazilian farmers had planted 23% of the area expected to be sown with the crop as of Oct. 22, up from 8% a week earlier though still behind the five-year average for the date, according to agricultural consultancy AgRural. Dry weather in many areas had been slowing work in the fields, but starting from mid-October improved rain has helped speed planting. Planting in Mato Grosso state, Brazil's biggest producer of soybeans, is also behind in comparison with earlier years, but the outlook is for more rain in the region, which should allow farmers to pick up the pace over the next several days, AgRural said. Brazil is the world's biggest producer of soybeans and the country's crop agency recently forecast a record harvest of 133.7 million metric tons for the 2020-2021 growing season. (jeffrey.Lewis@ wsj.com)

THE MARKETS:

Cattle Futures Steady as US Herd Rises -- Market Talk

15:28 ET - Live cattle futures trading on the CME finish slightly lower, down 0.2% to $1.034 per pound. According to the USDA's cattle on feed report released following the market's close Friday, as of October 1 the total inventory of US cattle in feedlots with +1000 head capacity was estimated at 11.72M head, 429,000 head or 3.8% higher than a year ago. However, livestock traders think that cattle weights are trending higher, which may lead to higher cattle head counts in future reports. "We think current fed weights are now as much as 3% above year ago levels," says Steiner Consulting Group. Meanwhile, lean hog futures closed up 1.1% to 67.75 cents per pound. (kirk.maltais@wsj.com; @kirkmaltais)


  (END) Dow Jones Newswires
  10-26-20 1726ET
  Copyright (c) 2020 Dow Jones & Company, Inc.

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