Written Commentary
CORN
Prices were down $.03-$.05 however managed to hold onto to modest gains for the week. Spreads also weakened. Mch-26 rejected early strength into new monthly highs closing near session lows. The BAGE reports Argentine corn ratings slipped 1% to 44% G/E while lowering their production forecast 1 mmt to 57 mmt, still well above the USDA’s 53 mmt estimate. Lower FOB offers in Argentina are starting to cut into US exports. USDA updates this month show farmer income is expected to fall nearly 1% in 2026 to $153.4 bil. Income would have been lower if not for a 45% increase in Govt. aid to $44.3 bil. Spot prices remain rangebound between $4.15-$4.40. After lowering corn ending stocks 9 out of 10 years between 2010-2019, the February WASDE report has been a dud the past couple of years.
SOYBEANS
Prices closed mixed and well off session highs. Beans ranged from $.05 lower on new crop to $.03 higher in spot Mch-26. Meal prices were within $1 of unchanged while oil was down 30-40 points. Mch-26 beans shot up to a fresh 2 month high before drifting back as farmer selling picked up. Mch-26 oil traded to a fresh 6 month high before pulling back. Mch-26 meal hit a 6 week high before selling off. O.I. was higher across the complex yesterday with the heavy speculative buying in bean and meal. Soybean O.I. was up 17k contracts, oil up 8k while meal was up 1.6k. Soybean basis levels have slipped, as cash prices have not kept up with the higher futures. The BAGE showed Argentine crop ratings plunged 9% to 40% G/E, however still well above the 20% from YA. Stats Canada reported canola stocks as of Dec. 31st at 15.62 mmt, in line with expectations. Brazilian bean exports in Feb-26 expected to surge to 11.42 mmt vs. 9.73 YA. Combined biodiesel and RD production fell 3.3% in Nov-25 to 418 mil. gallons. YTD production at 4.278 bil. is down 10% YOY. Policy uncertainty led to slowed production rates. Industry capacity rose less than 1% to a new record high of 6.972 bil. gallons annually. Soybean oil usage slipped 7.6% to a 7 month low at 930 mil. lbs. Usage in the first 2 months of the 25/26 MY at only 1.936 bil. lbs. is off 20% vs. the USDA forecast of up 26%. Despite optimism over higher RVO’s and Z45 tax credits the delay will likely trigger another cut in the USDA usage for biofuels currently at 14.8 bil. lbs.
WHEAT
Prices turned $.02-$.07 lower across the 3 classes by the close. Spreads were steady to easier. CGO Mch-26 fell back to its 100 day MA. KC Mch-26 has MA support at $5.26 ½. The 6-10 and 8-14 day outlooks have shown above normal precipitation for a week now with the 7 day outlook dry. Shouldn’t this precipitation be moving forward ? Yesterday’s drought monitor showed US WW acres in drought grew 2% to 43%, nearing its 52 week high of 45%. Stats Canada showed Dec. 31st stocks at 27.5 mmt, above the Ave. trade guess of 26.6 mmt, however within the range of estimates. The wheat market continues to lack a spark to ignite a meaningful short covering rally.
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