Written Commentary
CORN
Prices were $.05-$.08 lower today however closed with gains for the week. With no demand news today spreads continued to weaken with today being the first day of the Goldman roll. The Mch/May spreads traded out to a new low at $.13 ¼. Index funds are holding their largest position in corn in nearly 3 years at just over 470k contracts. The market is also bracing for this afternoon’s CFTC report that will likely show another build in speculative long positions. Pressured was fueled by an improved weather outlook in South America and reports that Pres. Trump is expected to announce reciprocal tariffs on American imports of foreign goods that are equal to our trading partners tariffs on American exports. In Argentina very hot, dry conditions across central and northern regions will hold into early next week before rain and cooler temperatures are expected to provide relief midweek. The second week of the outlook offers 2 more opportunities for rain. The BAGE reports Argentine corn ratings fell 3% to 25% G/E while 26% of the crop is rated poor, up 4% from LW. Since 2010 corn stocks have fallen 10 times, increased only 3 times while holding steady twice. Brazil’s Ag. Ministry reports corn exports in Jan-25 reached 3.59 mmt, down 26% from Jan-24.
SOYBEANS
Prices across the complex were mostly lower with beans down $.08-$.12, meal was$5-$6 lower while oil was up 40-60. Oil likely drew support from palm oil which was up over 2% overnight. While Mch-25 beans have slipped below $10.50, they remain well above this week’s low from Monday at $10.31 ¾. Beans spreads weakened while product spreads firmed. Mch-25 meal violated support at its 50 day MA, however held above $300. Bean oil also drew support from the Stats Canada report that showed canola stocks at the end of Dec-24 at 11.38 mmt, below expectations of 11.9 mmt and well below the 12.85 from YA. Spot board crush margins rebounded $.06 ½ to $1.19 ½ while bean oil PV jumped to 43.3%. Shower activity across EC and CS regions of Brazil will begin to lighten up in intensity and coverage allowing better opportunities for soybean harvest and corn plantings the 2nd half of Feb. The BAGE reports soybean ratings fell 3% to 17% G/E while 32% of the crop is rated poor, up 4% from LW. Safras & Mercado raised their Brazilian production forecast just over 1 mmt to 174.9 mmt, well above the USDA forecast of 169. Brazil’s Ag. Ministry reports Jan-25 bean exports reached only 1.07 mmt, vs 2.85 mmt in Jan-24. Since 2010 US bean stocks in the Feb. WASDE have fallen 7 times, while increasing or holding steady 4 times each.
WHEAT
Prices were steady to $.05 lower today with Chicago leading the declines. All 3 classes were able to carve out 3 month highs overnight before pulling back. Wheat prices continue to gain on corn fueled by the huge disparity of speculative holdings. MM’s were short nearly 111k in Chicago wheat while long just over 350k corn according to last Friday’s CFTC data. Much colder temperatures are expected across the Black Sea region and the US southern plains by late next week. While some snow cover is expected to develop out in front of the frigid temperatures, overall coverage and depth will be key to avoiding winterkill as little snow cover currently exists. Stats Canada reports wheat stocks at the end of Dec-24 at 24.48 mmt, above expectations of 23 mmt and well above the 20.68 from YA. Russia’s Ag. Ministry increased their wheat export tax 1% to 3,984.20 rouble/mt in the period ending Feb. 18th. Since 2010 US wheat stocks in the Feb. WASDE have fallen 5 times, increased 8 times while holding steady twice.
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