August 18, 2026
Grain Overview
Corn and soybean futures led the overnight session for upside price leadership, while wheat put in a mixed performance as it continues to stall at recent recovery highs. The Pro Farmer Crop Tour is finding disappointing yield potential as it rolls through South Dakota and Ohio, while Monday afternoon’s crop condition ratings showed a 1% drop in both the GD and EX categories.
Yield estimates for South Dakota were down 25 BPA compared to last year, while Ohio corn yield was off 5.5 bushels. Variability was noted, with some areas strong, but overall, the corn crop was found disappointing. Soybean potential in South Dakota showed pod counts averaging 946, which was down 20% from last year’s 1,188 pods. The soybean crop appeared to be further along in maturity already in early August with group 2 soybeans done blooming; potential still existed for the later-planted beans.
The Pro Farmer Tour now pushes further into the Midwest, where IL, IA, and IN will become the focus, and potentially improved yields will start to be reported. A flash drought has developed in Kansas, with Missouri hopeful for rain. The North Dakota corn crop is a bust, and it ranks eighth in corn production, behind Kansas in the 2025 rankings. These states are not on the tour. The trend of dry crops in the West continues, while saturated Central and Eastern Midwest forecasts persist.
Wheat prices had a small bounce overnight on reports of another vessel being struck in the Black Sea, while the war on grain and energy infrastructure continues. Adding to the difficulties, the Strait of Hormuz remains mostly closed, with the MOU now expired. Minimal traffic is exiting the SOH, with almost no return traffic. Fertilizer shortfalls from the Persian Gulf will have an effect on new 2027 crop production. Even J.P. Morgan notes that grain shortfalls will likely develop into next year. The days of plentiful grain supplies flowing from around the world are diminishing. The Black Sea is almost effectively closed, with the clock ticking on end-user wheat needs from this area, forcing them to procure supplies elsewhere.
Pres. Xi of China comes to the US on September 24, and there is a sense that they will continue to pursue US ag products, including corn, as sorghum is now priced above corn given the recent drought in the Western Plains. Row crop values remain supported on breaks, as not only does yield potential continue to decline, but increasing demand from Europe for corn will find its way to the US into the winter. A Chinese purchase of corn may also occur in the next 30 days.
A counter-seasonal grain price rally is in place, and these rallies tend to reach short-term highs after Labor Day. Not necessarily a crop-year high, but a cyclical high that tends to correct. The USDA will be forced to continue to lower not only world corn carryout numbers in future reports, but US corn carryout numbers as well, which look to go below 1.5 Bil Bu.
Cattle Overview
Yesterday’s cattle trade enjoyed a sharp early morning rally that was put back in check, with small losses seen in the live cattle closing trade while feeder cattle drifted on the front side. A friendly start is anticipated this morning, as the union vote for the Fort Morgan beef plant in Greeley, Colorado, owned by Cargill, went 5-1 to accept the current contract and move to a full workload in early September. This helps alleviate some of the news from Friday’s Tyson plant closures.
The cash feeder index was off $4.07 at $344.43, which August feeder cattle were close to trading at in the morning before drifting. August feeder cattle have 13 calendar days to match up with the index, while August live cattle closed yesterday at 224.37, indicating a cash cattle trade that will continue to drift into the end of the month.
Boxed beef values saw Select jump sharply yesterday, playing catch-up after a decent week for Choice pricing. Select jumped $13.02 in the afternoon, while Choice gained $4.27. Procurement for the upcoming Labor Day weekend and school lunch program buying is in play and produces an upward seasonal for boxed beef that tops after Labor Day.
October live cattle have solid technical support in the 215-217 range, while resistance will be difficult initially at 223-224. September feeder cattle should continue to find legs at 328-330, while 340-341 remains an initial upside cap. Closing above that reignites optimism for September feeders to make a run to near 346. October feeder cattle will soon come onto the continuation charts, and 336-339 will be their resistance point of difficulty.
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