Written Commentary
CORN
A late day recovery enabled prices to close mixed. Nearby futures were steady to $.01 lower while new crop was fractionally higher. Spreads weakened as we approach the Goldman roll which runs Friday thru next Thurs. Index funds are holding their largest position in corn in nearly 3 years at just over 470k contracts. While Mch-25 reached a fresh 9 month high, it was again not able to pierce the $5.00 level. The USDA announced the sale of 330k mt (13 mil. bu.) of new crop 25/26 MY corn to Mexico. Perhaps a push to get some grain on the books in the event tariffs kick-in next month. Ethanol production surged to 1,112 tbd, or 327 mil. gallons, up from 298 mil. the previous week and up 7.6% from YA. There was 112 mil. bu. used, or 15.94 mil. bu. per day, well above the 14.9 needed to reach the USDA forecast of 5.50 bil. bu. Ethanol stocks jumped to 26.4 mil. barrels, above expectations and an 11 month high. Census exports in Dec-24 at 214 mil. bu. were well above the weekly inspections data and up 13.3% from Dec-23. In the first 4 months of the 24/25 MY exports at 727 mil. are up 29% from YA, vs. the USDA forecast of up 7%. Census sales are running 98 mil. bu. above inspections thru the end of Dec-24. Rabobank is forecasting Brazilian corn production at 126 mmt, just below the USDA est. of 127 mmt. Despite this week’s rain, the Rosario Grain Exchange held their corn production est. unchanged at 49.0 mmt vs. the USDA’s est. of 51 mmt. Export sales tomorrow are expected to range from 35-60 mil. bu.
SOYBEANS
Prices were lower across the board with beans down $.10-$.16 led by old crop, meal was $5 lower while oil was off 70 points. Bean spreads weakened while product spreads were little changed. Early strength took Mch-25 soybeans to a 4 month high before backing up. Inside trade for Mch-25 meal with support coming in at the 100 day MA at $308.50. Also inside trade for Mch-25 oil as prices consolidate near $.45 lb. Spot board crush margins set back another $.02 to $1.17 ½ with bean oil PV holding steady at 42.2%. Early strength was not able to hold, perhaps fueled over disappointment Pres. Trump and Chinese Leader Xi haven’t spoken since China announced their retaliatory tariffs earlier this week. South American weather also fed into the bearish psyche as heavy rains ranging from 1”- 4” filled in over dry areas of Argentina overnight including S. Cordoba and Sante Fe along with the northern half of Buenos Aires. In Brazil farmers in the WC and CS growing regions will continue to have to work around rain showers keeping soybean harvest and 2nd corn plantings at a slower than normal pace. Delayed soybean harvest would certainly help open the door for additional US demand. RGDS in the deep south also braces for a hot/dry stretch likely causing some crop stress. Rabobank is forecasting Brazilian production at 170 mmt, just above the USDA est. of 169 mmt. The RGE also held their bean production est. unchanged at 49.6 mmt vs. the USDA’s est. of 52 mmt. Census exports in Dec-24 at 293 mil. bu. were also above the weekly inspections data and up 65% from Dec-23. In the first 4 months of the 24/25 MY exports at 1.111 bil. bu. are up 25% from YA, vs. the USDA forecast of up 8%. Census sales are running 24 mil. bu. above inspections thru the end of Dec-24. While SA will in all likelihood produce another record crop, the current pace to US exports combined with delays in Brazil’s harvest will likely prevent the USDA from changing their current export forecast of 1.825 bil. bu. Export sales tomorrow are expected to range from 12-40 mil. bu. for beans, 200-450k tons of meal and (10)-20k tons of oil.
WHEAT
Prices were $.02-$.05 lower across all 3 classes today. While early strength was not able to hold, prices managed to recover closing off session lows. Chicago Mch-25 rejected trade above $5.80 closing very near its 100 day MA support at $5.72. Mch-25 KC rejected trade above $6.00, a level it has been below since last Oct-24. Mch-25 MGEX rejected trade above $6.20 however bounced off a challenge of its 100 day MA. Census exports in Dec-24 at 61 mil. bu. were up 9% from Dec-23. In the first 7 months of the 24/25 MY exports at 476 mil. bu. are up 29% from YA, vs. the USDA forecast of up 20%. Censes sales are running 13 mil. bu. above inspections thru the end of Dec-24. Wire services are reporting China claims to have excess wheat inventories prompting them to delay or re-sell up to 600k mt of imports to neighboring Asian countries. A South Korean flour mill reportedly bought 85k mt of US milling wheat which included 37k soft white priced between $231-$238/mt FOB. Export sales tomorrow are expected to range from 8-20 mil. bu.
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