January 13, 2025 - Newswires

Corn and soybeans surged as the USDA projected lower-than-expected U.S. production after a dry end to the growing season; ...

Good afternoon, Farmer Family ...

US farm markets mostly rose on Friday.

Corn prices jumped 3.18%.

Soybeans climbed 2.63%.

The rest of the soy complex was mixed as soymeal slid 0.33%, while soyoil rocketed 6.59% higher.

Wheat prices were mostly unable to capitalise on any support from corn and soybeans rally as Chicago SRW dropped 0.61%, Kansas City HRW inched up just 0.27%, while Minneapolis spring wheat lifted only 0.13%.

• Corn and soybeans surged after the USDA projected lower-than-expected U.S. production for both crops.
• The annual Crop Production report showed a 1 bpa drop to yield at 50.7 bpa for US soybeans.
• Harvested acres were trimmed by 250,000 acres to 86.05 million, which added to the drop in production of 95 mbu to 4.366 bbu.
• With the smaller supplies heading in, the December 1 stocks total was tallied at 3.099 bbu, 112 mbu below estimates and up just 98 mbu from last year.
• The WASDE ending stocks projection was trimmed by 90 mbu to 380 mbu, 77 mbu below estimates.
• Most of the demand side of the balance sheet was left unchanged, with imports up 5 mbu.
• On the world side, USDA left the Brazilian and Argentine numbers alone.
• Ending stocks for the world were tightened to 128.37 MMT below December by 3.5 MMT and well below estimates that were calling for an increase.
• For corn, the report showed the US corn yield from 2024 at 179.3 bpa.
• That was a 3.8 bpa drop from the November report.
• Harvested acreage saw a 196,000 acre increase, but production was slashed by 276 mbu at 14.867 bbu.
• The tighter production took the December 1 stocks to 12.074 bbu, which was down 97 mbu from last year and 73 mbu below estimates.
• The full year carryout projection from the WASDE showed an estimated 1.54 bbu of ending stocks, which was down 198 mbu from last month.
• Exports were trimmed by 25 mbu on the smaller supplies, with feed and residual down 50 mbu.
• The cash average price was raised by15 cents to $4.25.
• On the world side USDA made no changes to the South American crops.
• Ending stocks for the world were trimmed down to 293.34 MMT, a drop of 3.1 MMT from December and nearly 1.5 MMT below estimates.
• Tariff threats from U.S. President-elect Donald Trump that could spark retaliation from importers have also hung over the market.
• Meantime, Chicago soyoil futures extended a rally to a seven-week peak.
• The rally was fuelled by talks that incentives for importing used cooking oil (UCO) would end and credits for soybeans would ease.
• The tax credits, vital to Biden’s sustainable aviation fuel goals, remain dormant due to a lack of US Treasury guidance.
• Biofuel companies and supporters now await Donald Trump’s stance on the upcoming guidelines, with a possible boost for domestic soyoil demand.
• Wheat prices slipped, meantime, as traders struggled to find bullish drivers, with a stronger US dollar adding pressure.
• December 1 Grain Stocks data came in pretty close to the trade estimates, with 1.569 bbu in wheat stocks.
• That was up 148 mbu from last year and 4 mbu larger than the average trade guess.
• The US WASDE balance sheet saw few changes, with imports up 5 mbu, as ending stocks were up by 3 mbu to 798 mbu.
• World wheat ending stocks were raised by 0.94 MMT to 258.82 MMT.
• The Winter Wheat Seedings report showed all winter wheat acreage at 34.115 million acres, up 725,000 acres from last year.
• HRW was tallied at 24 million, up 213,000 acres from 2024, with SRW at 6.44 million acres (+378,000 acres) and white at 3.64 million acres (+99,000 acres).
• Meantime, the delayed weekly Export Sales report showed just 444,950 MT of 2024/25 corn bookings in the holiday week ending on January 2.
• That was a MY low and down 42.7% from last week.
• For soybeans, the report tallied 2024/25 soybean sales at just 288,671 MT, coming in at a MY low.
• A total of 696,100 MT in net reductions was reported by unknown destinations, with most switched to a destination.
• Meal sales totaled 144,918 MT, the lowest for the marketing year.
• Soybean oil sales were tallied at 34,634 MT.
• For wheat, the report tallied another MY low in sales at just 111,309 MT
• Net reductions of 89,000 MT were reported to unknown, with most being switched to a destination.

In this context ...

• Corn basis bids eased a penny lower at a Nebraska processor while holding steady elsewhere across the central U.S..
• Soybean basis bids trended 2 cents higher at an Illinois river terminal while holding steady elsewhere across the central U.S..
• Commodity funds were massively buying corn and soybeans, and marginally buying wheat.

For the week ...

• Corn put on a rally, mainly on the Friday move, with March up 4.39% and hitting the highest price on the spot month chart since last May.
• Soybeans found some footing, with March up 3.38%.
• Bean oil rallied 14.15%.
• Soymeal was down 3.34% on the week.
• Wheat posted some gains in all three markets, with some bigger than others.
• Notably, Chicago March was back up 0.28% on the week.
• March Kansas City posted a 2.37% gain, while MPLS was 1.13% higher, from Friday to Friday.

This morning ...

Corn and soybeans rose to multi-month highs. Wheat also rose, but prices remain near four-year lows.

• Notably, by 0334 GMT, the most active corn contract on the Chicago Board of Trade had risen 0.7%, soybeans had gained 0.8%, and wheat was up 0.8%.
• The week start off per normal, with the weekly Export Inspections report in the afternoon.
• On Tuesday, PPI data will be released, with CPI data out on Wednesday.
• EIA’s weekly Petroleum Status Report will out on Wednesday, with NOPA data also out that morning.
• The weekly Export Sales report will be back to a Thursday release.

Canada

Common wheat deliveries into the handling system during the week ending Jan 5, 2025, were at 254,1k mt, with durum at 82.3k mt as well.

• Canadian wheat exports for shipping weeks 22 came in at 272,4k mt, for a total of 8.710,8k mt YTD.
• Durum wheat exports were at 17,4k mt, for a total of 2.268,2k mt YTD.
• Commercial stocks stood at 2.161,90k mt for common wheat, and at 541.4k mt for durum.
• Meantime, Western Canadian cash prices for spring wheat and amber durum were lower during the week ended Jan. 9.
• Average CWRS (13.5%) prices were down C$1.20 to C$7.70 per tonne.
• Those prices ranged from about C$275.10 per tonne in southeastern Saskatchewan to C$301.30 per tonne in southern Alberta.
• Average CPRS (11.5%) wheat slipped C$1.50 to C$2.80 per tonne.
• Bids ranged from C$250.70 per tonne in southeastern Saskatchewan to C$281.10 per tonne in southern Alberta.
• Average CWAD prices dipped five to 20 cents per tonne.
• Bids ranged from C$313.30 per tonne in northeastern Saskatchewan to C$333.10 per tonne in southern Alberta.

South America

Brazilian agribusiness consultancies shared contrasting views on Friday as they released fresh estimates for the country’s 2024/25 soybean crop, with Safras & Mercado hiking its forecast while Patria AgroNegocios trimmed its projection.

• Both firms still forecast Brazil to harvest a record crop this year, but Patria noted that adverse weather in some key states should keep production below the level of 170 million metric tons.
• Notably, Patria pegged Brazil’s soybean output this season at 167.94 million tons.
• Consultants Safras & Mercado conversely raised their forecast from Brazil’s 2024/25 soybean production to 173.71 million tons.
• Safras & Mercado acknowledged weather issues in the same states cited by Patria, noting they could lead to lower output, but indicated that a “very favorable scenario” in top grain-producing state Mato Grosso would help offset those losses.

Europe

European grain markets rallied.

• Benchmark March milling wheat on Paris-based Euronext settled 1.6% higher at 233.00 euros ($238.76) per metric ton.
• In late deals the contract touched a one-week high at 233.75 euros as it bounced back from a three-week low of 228.00 euros earlier in the session.
• MATIF March corn contract ended up €2.5/t to €213.75/t.
• In oilseeds, February rapeseed settled 1.7% higher at 524.50 euros a ton, after touching a two-week top of 547.75 euros in late deals.
• Wheat prices rebounded in late trading, as U.S. government crop estimates triggered a broad rally in grains, taking attention away from stiff export competition in wheat.
• The USDA surprised traders with bigger than expected cuts to its estimates of last year's U.S. corn and soybean harvests.
• However, the USDA has not touched its European wheat balance sheet, leaving the forecast 2024-25 stock at 10.6mn t against 15.5mn t in 2023-24.
• Ditto in corn with a forecast stock on the EU at 6.6mn t in 2024-25 against 7.3mn t in 2023-24.
• In spite of that, wheat prices turned higher, as U.S. corn and soybean futures rose sharply, shaking off pressure from a rising dollar and a higher-than-expected USDA estimate of U.S. winter wheat sowing.
• However, although immediate reaction to the US government data spurred futures higher, sentiment on the physical market in Western Europe remained gloomy.
• And that, in spite a new two-year low for the euro against the dollar.
• Black Sea prices indeed are still looking very cheap compared to the west EU.
• Romanian 12.5% was quoted at around $237-$238 a ton FOB.
• About 25,000 tons of Ukrainian feed wheat was offered for sale at around 240 euros a ton including delivery to north Spain in January/February.
• Ukrainian feed wheat was also offered at 238-240 euros a ton including delivery to north Italy.
• There was also concern that the weak trend in the Russian rouble against the dollar will encourage more Russian exports despite all the state efforts to slow shipments.
• As a result, Senalia, which runs the largest terminal at France's biggest grain port Rouen, forecast on Friday its cereal export volumes would drop by more than half in 2024/25 to 1.6 million tons.

Ukraine

Analyst APK-Inform has increased its Ukraine 2024 grain harvest forecast to 53.62 million metric tons.

• Conversely, the consultancy has made a downward revision to its forecast for the Ukraine 2024/25 sunflower seed harvest now see at 13.55 million metric tons.
• APK-Inform also cut its projection for Ukraine's 2024/25 sunflower oil output to 5.83 million tons.
• On the export side, the consultancy increased its Ukraine 2024/25 July-June grain export forecast to 37.79 million tons, largely because of higher than expected corn exports.
• This export dynamic in the corn market have also influenced the gradual growth of prices.
• As of January 10, prices for feed corn were fixed mainly in the range of 8500-9600 UAH/t CPT, which was 100-200 UAH/t higher than at the beginning of the year.
• On the other hand, APK-Inform lowered their sunoil export outlook to 5.48 million tons.
• Meantime, according to the operational data of the State Customs Service, as of January 10, Ukraine has exported 22.622 mln tonnes of grain and leguminous crops since the beginning of the 2024/25 MY, of which 885 thousand tons have been shipped since the beginning of this month.
• Notably, since the beginning of the current season were exported, wheat for 10.074 mln tonnes; barley for 1.976 mln tonnes, corn for 10.244 mln tonnes.
• Total exports of Ukrainian flour since the beginning of the season as of January 10 were estimated at 38.9 thousand tonnes, including wheat flour at 35.6 thousand tonnes.

Russia

On January 9, Rosselkhoznadzor held online talks with representatives of Kazakhstan's Ministry of Agriculture on mutual supplies of plant products.

• “The Kazakh side confirmed the lifting of the ban on wheat imports from January 1 from third countries and EAEU countries, which was imposed from August 21 to December 31, 2024.
• Now wheat imports to Kazakhstan will be carried out without restrictions,” Rosselkhoznadzor's press service said.
• The negotiations also addressed the issues of compliance with phytosanitary requirements when importing seed and grain to Russia from Kazakhstan.
• Representatives of the competent departments of the two countries agreed to discuss in the near future the procedure of phytosanitary control conducted on the territory of Kazakhstan when shipping regulated goods to Russia.

China

China's soybean oil and meal futures logged their biggest daily rise since 2023 on Monday, while rapeseed meal and palm oil contracts also jumped, following a rally in the Chicago soy complex after the release of bullish USDA crop reports.

• Notably, the most-active soymeal futures on the Dalian Commodity Exchange increased 3.2% to 2,724 yuan ($371.54) per ton, its highest in over a month and its biggest daily gain since July 2023.
• Dalian's soybean oil futures also gained 2.5% to 7,718 yuan per ton, the highest since Jan. 3, while palm oil futures rose 2.7% to 8,720 yuan per ton.
• On the Zhengzhou Commodity Exchange, the most active rapeseed meal futures rose 3.3%, reaching their highest levels in six days to 2,340 yuan per metric ton.
• The USDA projected lower-than-expected U.S. soybean production and lowered its soy ending stocks, sending Chicago soybean and soyoil prices to multi-month highs.
• Concerns over tightening global vegetable supplies were also heightened after Malaysia reported that its inventories fell for a third consecutive month in December to hit their lowest since May 2023.
• China imported a record 105.03 million tons of the oilseed in 2024, according to Chinese customs data.
• That was a 6.5% increase from a year ago.
• Buyers have been concerned about rising U.S.-China trade tensions, and rushed to secure U.S. supplies ahead of President-elect Donald Trump's inauguration.
• However, for December, arrivals dropped 0.2% to 7.94 million tons from the same month a year earlier, marking the smallest amount in four years.
• Crush margins in China's main processing hub at Rizhao have been negative since November, and were last at a loss of 225.04 yuan ($30.69) per ton of soybean processed.
• China's markets will be closed from Jan. 28 to Feb. 4 for the week-long Spring Festival holidays.

Southeast Asia

India

India's wheat stocks continued to deplete, with traders urging the government to increase wheat sales amid market shortages.

• Flour mills are seeking government supplies to continue their operations, as sufficient stocks are not available in the open market.
• The government plans to sell 2.5 million tons of wheat from state reserves to bulk consumers in the year ending March 2025.
• That is compared with 10 million ton in the previous season.
• Wheat stocks as on Jan. 1, stood at 18.4 million tons.
• That was far below the five-year average of 26.7 million tons.
• As a result, wheat prices jumped to a record high past week, but it should to note that wheat stocks last season was just 13.8 million tons, well below this season numbers.

Malaysia

Malaysian palm oil prices ended more than 2% higher, bouncing back to log a weekly gain, tracking stronger Chicago soyoil prices.

• Notably, the benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange rose 2.26% by the close.
• The contract gained 0.57% for the week.
• However, expectations for a drop in Indonesian palm oil reference price in February, and uncertainty over the success of Indonesia’s B40 biodiesel mandate, along with lacklusture Dalian palm olein futures, capped gains.
• Dalian’s most-active soyoil contract rose 0.88%, while its palm oil contract gained 0.21%.
• Also, Malaysia’s palm oil stocks declined for a third consecutive month, falling 6.91% to 1.71 million metric tons at the end of December, while crude palm oil production fell 8.3% and exports plunged 9.97%, data from the Malaysian Palm Oil Board showed on Friday.
• Cargo surveyors estimated that Malaysian palm oil exports fell between 21.4% and 26.8% during the Jan. 1-10 period.
• The Malaysian ringgit strengthened 0.16% against the dollar, making the commodity more expensive for buyers holding foreign currencies.

Australia

Aussie growers have wrapped up most of their crops for the season.

• Western Australian growers have delivered more than 20 million tonnes (Mt) to CBH Group sites in the harvest to January 3, the company announced on social media.
• Growers delivered 288,580 tonnes into Viterra’s network in the three weeks to January 5 to take total 2024-25 harvest deliveries to 3,239,644t.
• Eastern Australian bulk handler GrainCorp has received 10.9 million tonnes (Mt) of grain for the 2024-25 harvest.
• Meantime, canola ended the week well supported with WA bids around $880 FIS.
• In the eastern states, canola ended the week above $800, bid around $805.
• WA wheat was steady around $372, with barley around $322.
• In the eastern states, wheat was unchanged, with APW at $345, and barley around $305.
• Pulse bids continue to be well-supported by the weak AUD.
• Delivered Geelong/Melbourne faba beans are bid around $610 and lentils at $930–$940.

International grain and oilseed tenders & trade

• The Incheon section of the Korea Feed Association (KFA) in South Korea is believed to have purchased about 65,000 metric tons of animal feed corn in a private deal on Thursday without issuing an international tender. It was believed to have been purchased from trading house Columbia Grain International at an estimated $234.99 a ton cost and freight (c&f) included with no surcharge for additional port unloading. The corn can be sourced from the United States, South America or South Africa for arrival in South Korea around April 15. If sourced from the US Pacific Northwest coast, shipment is between March 1-March 31.

Outside markets ...

Energy markets

Oil prices rallied nearly 3% to their highest in three months.

• Notably, Brent crude futures settled up 3.7%, after crossing $80 a barrel for the first time since Oct.7.
• U.S. West Texas Intermediate crude futures rose 3.6%, ending to a three-month high.
• Traders are bracing for supply disruptions from the broadest U.S. sanctions package targeting Russian oil and gas revenue.
• President Joe Biden's administration imposed fresh sanctions targeting Russian oil producers, tankers, intermediaries, traders and ports, aiming to hit every stage of Moscow's oil production and distribution chains.
• That is expecting will affect Russian crude exports to top buyers China and India.
• Oil prices were also buoyed as extreme cold in the U.S. and Europe has lifted demand for heating oil.
• U.S. ultra-low sulfur diesel futures rose 5.1% to settle at $105.07 per barrel, the highest since July.

This morning, oil prices extended gains for a third session, with Brent rising above $80 a barrel to its highest in more than four months.

• Notably, Brent crude futures climbed 1.43%, by 0741 GMT after hitting an intra-day high of $81.49, the highest since Aug. 27.
• U.S. West Texas Intermediate crude rose 1.57%, after touching a high of $78.39, the most since Oct. 8.
• Brent and WTI have risen by more than 6% since Jan. 8.

Ocean freight markets

The Baltic Exchange's main sea freight index advanced for the second successive day, jumping about 8.2% to a one-week high.

• Notably, the main index rose 79 points to 1,048 points.
• The capesize index climbed 284 points to its highest since December 10,2024 at 1,448 points.
• Conversely, the panamax index fell by 39 points to its lowest since July 2023 at 953 points.
• The supramax index shed 11 points at 830 points and recorded its 13th consecutive day of decreases.
• For the week, the benchmark index was down 2.2%.

Equity markets

U.S. stock markets sold off.

• The Dow Jones Industrial Average dropped 1.6%, the S&P 500 tumbled 1.5%, and the Nasdaq composite sank 1.6% to 19,161.63.
• US Dec nonfarm payrolls rose by +256,000, posting the largest increase in 9 months.
• Dec unemployment rate fell -0.1 to 4.1%.
• Dec average hourly earnings eased to +3.9% y/y.
• Meantime, the US 10-year T-note yield soared+8.3 bp to a 14-month high of 4.772%.
• Also, the weakness in chip stocks weighed on the overall market, after Bloomberg reported on Wednesday that the Biden administration wants to curb the sale of AI chips used in data centers on both a country and company basis.
• Stock losses accelerated after the University of Michigan reported US Jan consumer sentiment index fell -0.8 to 73.2.
• US Jan 1-year inflation expectations indicator accelerated to an 8-month high of +3.3%.
• Also, the Jan 5-10 year inflation expectations indicator jumped to a 16-year high of +3.3%.
• Meantime, the US 10-year T-note yield soared+8.3 bp to a 14-month high of 4.772%.
• In Europe, the Euro Stoxx 50 closed down -0.81%.
• China's Shanghai Composite Index fell to a 2-1/2 month low and closed down -1.33%.
• Japan's Nikkei Stock 225 slid to a 2-week low and closed down -1.05%.
• The Japan Nov leading index CI fell -2.1 to 107.0.
• Japan Nov household spending fell -0.4% y/y.

This morning, Asian stocks retreated.

• Hong Kong’s Hang Seng dropped 0.8%, the Shanghai Composite lost 0.3%, Australia’s S&P/ASX 200 dipped 1.2%, South Korea’s Kospi shed 1%.
• Markets in Japan were closed for a holiday.
• China reported its exports grew at a faster pace than expected in December.
• Exports rose 10.7% from a year earlier.
• Imports rose 1% year-on-year.
• With exports outpacing imports, China’s trade surplus grew to $104.84 billion.
• However, the upbeat Chinese data failed to boost the region's stocks.

Currency trading

The dollar index rose, posting a 2-year high.

• Stronger-than-expected US Dec payroll report pushed bond yields higher, boosting the dollar.
• Also, University of Michigan US Jan inflation expectations indicator unexpectedly accelerated.
• Hawkish comments from Fed Governor Bowman and Fed President Collins and Schmid, made an additional support for the dollar.
• A slump in stocks has also increased liquidity demand for the greenback.
• Meantime, the EUR/USD fell, posting a 2-year low.
• Losses in the euro, however, have been contained after the 10-year German bund yield rose to a 6-month high.
• On the other hand, the USD/JPY fell, as the yen recovered from a 5-3/4 month low against the dollar.
• A rally in crude oil prices to a 3-month high, boosted inflation expectations.
• Also, Bloomberg reported that BOJ officials are likely to discuss raising their inflation outlook at a policy meeting later this month, and that supported the yen.
• In economic news, the Japan Nov leading index CI was weaker than expectations.
• Meanwhile, Japan Nov household spending, posted a smaller decline than expectations.

This morning, the U.S. dollar fell to 157.34 Japanese yen from 157.82 yen. The euro dropped to $1.0220 from $1.0244.

Settlement Prices for Key Commodity, Index & Currencies

• Chicago wheat Mar contract was down 3.2c/bu to 530.6c/bu;
• Kansas wheat Mar contract was up 1.4c/bu to 551.6c/bu;
• Minneapolis wheat Mar contract was up 0.6c/bu to 584.2c/bu;

• MATIF wheat Mar was up €3.75/t to €233/t;

• ASX wheat Mar contract was down A$0.5/t to A$326/t;
• US DWI Cash (durum wheat index) was down 1.26c/bu to 646c/bu;

• 1CWAD (Canadian durum) avg spot price was up C$0.12 /t to C$321.17/t.

• EDW (EU durum) Mar contract was unchanged to €316.5/t;

• Chicago corn Mar contract was up 14.4/bu to 470.4c/bu;

• MATIF corn Mar was up €2.5/t to €213.75/t;

• Chicago soybeans Mar was up 26.2c/bu to 1,025.20c/bu;
• Winnipeg canola Mar contract was up C$16.7/t to C$641.6/t;

• MATIF rapeseed Feb was up €9.25/t to €542.5/t;

• Brent crude Mar was up US$2.84/barrel to $79.76;

• WTI crude Feb was up US$2.65/barrel to $76.57;

• BADI (Baltic Dry Index) was up 79 points to 1,048;

• Dow Jones was down 696,75 points to 41.938,45;
• S&P 500 was down 91,21 points to 5.827,04;
• NASDAQ Composite was down 317,25 points to 19.161,63;
• US dollar index (Mar '25) was up 0.483 points to 109.487;

• AUD/USD weaker at US$0.6144;
• USD/CAD firmer at $1.4423;
• EUR/USD weaker at $1.0240;
• USD/RUB weaker at ?101.7554.

That's all, thank you.

We wish you a nice day.

Author: Sandro F. Puglisi

Source: Me, AAFC, ABARES, Abiove, AHDB, Amis, Argus Media, Baltic Exchange, Buenos Aires Grain Exchange, CFTC, CGC, China AgMin, Clear Grain Exchange, CME, Conab, Copernicus, CWG, ECB, ECMWF, EIA, Euronext, European Commission, Eurostat, FAO, FCI, FED, GASC, GIWA, ICE, IEA, IGC, IKAR, JRC MARS Bulletin, LSEG, MPOB, National Bureau of Statistics of China, ODC, OIAC, RBA, Reuters, Rosario Grain Exchange, Russia AgMin, Russian Grain Union, S&P Global, SovEcon, StatCan, USDA, UA AgMin, and Others ...

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