Corn rose, hovering near one-year highs; Soybeans fell on profit-taking, while wheat closed mixed in a choppy session ...
Good afternoon, Farmer Family ...
US farm markets ended mixed on Wednesday.
The rest of the soy complex was mixed as soymeal moved 1.24% lower, while soyoil gained 0.11%.
Wheat prices also were mixed as Chicago SRW added 0.14%, Kansas City HRW dropped 0.58%, and Minneapolis spring wheat fell 0.34%.
- Corn rose, hovering near one-year highs.
- Traders continued to adjust to a tighter supply outlook projected last week by the USDA.
- Meanwhile, operators fretted about Argentine crop weather.
- Some forecasts indeed called for weekend rains that should offer a measure of relief.
- However, dry conditions could rebuild later this month, the Commodity Weather Group said.
- Gains however were limited as Weekly EIA data showed ethanol production at a total of 1.095 million barrel per day in the week of 1/10.
- That was a drop of 7,000 bpd in that week.
- Stocks continue to build, up another 860,000 barrels to 25.008 million barrels.
- Exports were down 30,000 bpd wk/wk, at 125,000 barrels per day.
- Refiner inputs of ethanol were back up 50,000 barrels per day at 829,000 bpd.
- Soybeans, meantime, fell on profit-taking a day after rising to a three-month high.
- Monthly U.S. soy crush data underscored strong production of soymeal.
- NOPA crush data showed December crush totaling 206.6 mbu, more than 1 mbu above estimates.
- That was an increase of 6.96% from last month, 5.77% larger than December 2023 and an all-time record for any month.
- However, bean oil stocks were tallied at 1.24 billion lbs, the largest in 5 months, though still 9.11% below the end of 2023.
- As a result, soymeal prices sagged, dragging down the market.
- Soybeans were also under pressure from the start of what is widely forecast to be a record soy harvest in Brazil.
- However, soyoil drew some support from a nearly 4% climb in U.S. crude oil prices, and limited losses in the soycomplex.
- Wheat prices closed mixed after a choppy session.
- Chicago wheat firmed but rallies were capped by a backdrop of strong global competition for tepid export demand.
- Meantime, KC HRW saw losses in the front months, while MPLS spring wheat was steady to 2 cents lower by close.
- Merchants said trade was less busy than it had been earlier in the week, but farmers were still more engaged than they were at the end of 2024.
- Dry weather is expected to persist in the next two weeks in the Southern Plains but the wheat crop is mostly dormant, according to Commodity Weather Group.
- Corn basis bids were steady to mixed after trending as much as 4 cents higher at an Ohio elevator and as much as 3 cents lower at an Iowa ethanol plant.
- Soybean basis bids were mostly steady to weak after tracking 3 to 10 cents lower across four Midwestern processors. An Ohio elevator bucked the overall trend after shifting 2 cents higher.
- Basis bids for hard red winter wheat were unchanged in a spot check of locations in the U.S. Plains, as farmer sales dropped off somewhat but remained active.
- Protein premiums for HRW wheat shipped by rail to or through Kansas City were unchanged.
- Commodity funds expanded their net long position in CBOT corn for a fifth consecutive day.
- Meanwhile, speculators hold net short positions in both soybeans and wheat on the CBOT.
Corn prices eased, but remained close to a 13-month high; Soybeans fell sharply; Wheat dipped amid lacklustre demand.
- Notably, the most active corn contract on the Chicago Board of Trade fell 0.3% as at 0536 GMT, soybeans fell 1%, soyoil dropped 1% breaking eight consecutive sessions of gains, and wheat slipped 0.6%.
South America
In Argentina, some forecasts called for weekend rains that should benefit soy crop areas that have struggled with hot and dry weather, but dry conditions could rebuild later this month, the Commodity Weather Group said in a client note.
- Meantime, Argentina's Rosario grains exchange trimmed its 2024/25 corn harvest forecast on Wednesday due to a drought gripping the country.
- The exchange cut its corn estimate to 48 million metric tons from a prior forecast of between 50 million and 51 million tons.
- The exchange said it also sees 2024/25 soybean production below its previous forecast of between 53 million and 53.5 million tons, but the institution did not specify a figure.
- Extreme temperatures, low relative humidity and high levels of solar radiation are the main reasons behind its sharp forecast reduction.
- While the exchange forecasted precipitation in the coming days, it expects the accumulated rainfall to be very moderate.
Europe
European grain markets ended in the red.
- Notably, benchmark March milling wheat on the Paris-based Euronext settled down 1.3% at 228.25 euros ($234.89) per metric ton.
- MATIF Mar corn contract ended down €2/t to €213.75/t, while Feb rapeseed slid €1/t to €536.25/t.
- Wheat fell for a second straight session, as operators remained focused on sluggish export demand for EU supplies.
- Also, a downside chart gap created at the opening added to selling momentum.
- Data on Wednesday showed that financial investors widened their net short position in Euronext wheat last week added to the bearish mood.
- Monthly estimates from FranceAgriMer, in which the farm office maintained its forecast for the lowest French soft wheat exports outside the European Union this century, underscored poor prospects for the EU's main wheat producer.
- Notably, FranceAgriMer saw French 2024/25 soft wheat exports down 40 percent y-o-y, at 9.74 million tonnes (Mt), versus its December estimate of 9.76Mt.
- French soft wheat exports to non-EU destinations this season are seen at 3.5 million metric tons, down 66% from 2023/24.
- The carry-over stock in wheat is now estimated at 2.89mn t, a level still above the average of the last 5 seasons.
- It also cut its barley export forecast thereby increasing barley carryout to 1.61Mt from December estimate of 1.38Mt.
- FranceAgriMer also readjusted the end-of-season corn stock by +100,000 t, in particular by downgrading the potential for incorporation into animal feed.
- The volume of carry-over stocks in corn is now close to 2.8mn t.
- These various elements weighed on European grain prices.
- With cheaper Black Sea and Argentine supplies seen dominating short-term demand from importers, EU exporters were expected to continue relying on sales to Morocco.
- Traders were also watching developments after a case of foot-and-mouth disease on a farm in east Germany on Friday which sparked meat import bans by Britain and other non-EU countries.
- Also, the latest developments in the euro against the dollar, favoured some price adjustments.
- In oilseeds, the approach of the closing of the February 2025 contract and the closing of the options contracts, lead traders to focus on the May 2025 contract.
- However, the opposite movements in vegetable oils, with yesterday the decline in palm prices and the firmness of soybean oil prices, illustrated a very nervous market.
- EU economic indicators, are showing a recession movement observed for a second consecutive year in Germany.
- The economic situation is darkening again while at the same time the crude oil price has appreciated markedly since the beginning of the year.
Ukraine
Per latest data from the State Customs Service of Ukraine, as of January 15, Ukraine has exported 23.616 mln tonnes of grain and leguminous crops since the beginning of the 2024/25 MY, of which 1.388 tonnes were shipped this month.
- In terms of crops since the beginning of the current season were exported, wheat for 10.326 mln tonnes, barley for 2.008 mln tonnes, corn for 10.868 mln tonnes.
- Total exports of Ukrainian flour since the beginning of the season as of January 15 are estimated at 39.4 thousand tonnes, including wheat flour at 36.1 thousand tonnes.
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- Meantime, Ukraine will reduce areas sown to soybeans and rapeseed this year but will increase corn areas, Ukrainian farm business association UCAB said.
- Global soybean prices have fallen significantly, so the area under soybeans will be smaller.
- Also, Ukraine harvested a record-high soybean harvest of more than 6 million metric tons in 2024.
- In addition, poor weather during the autumn sowing had cut the area sown to winter rapeseed while farmers could instead increase the corn area in spring 2025.
Russia
In the first half of the current season (July-December 2024), Russia exported 34.257 mln tonnes of major grains and leguminous crops.
- That is 5.4% lower compared with 36.209 mln tonnes exported in the same period of 2023/24 MY.
- Notably, Russian wheat shipments in the first half of the season grew by 0.7% to 30 mln tonnes.
- Meanwhile barley and corn fell by 27% to 2.9 mln tonnes and by 46% to 1.284 mln tonnes, respectively.
- Taking into account that Russian annual export potential for grain is estimated at 56 mln tonnes, as of January 1, 61% of the export potential for grain and 65% for wheat had been shipped, for this season.
- Thus, the export potential for the second half of the season is 21.7 mln tonnes of grain, including 16 mln tonnes of wheat.
- On the other hand, according to preliminary data, during 2024 Russia supplied more than 5.7 mln tonnes of sunflower oil to foreign markets.
- That is 31% more then 2023 exports.
- About 39% of all shipments of Russian sunflower oil were destined for India.
- India imports of sunflower oil grew 2.4 times year-on-year, exceeding 2.2 mln tonnes.
- Thanks to such dynamics, India, which in 2023 became the leader among the countries buying Russian sunflower oil, strengthened its position during the last year.
- The second place among buyers of Russian sunflower oil is occupied by Turkey with 840 thousand tonnes.
- China in 2024 fell to the 3rd place among importers of the Russian product, purchasing 590 thousand tonnes of sunflower oil from Russia, which is 35% less than the volume a year earlier.
China
LSEG Commodities Research upped its estimates for China’s 2024/25 season by 1% to 294.89 MMT of corn, after reviewing China’s National Bureau of Statistics corn area and production estimates, coupled with weather and satellite imagery-based model results.
Southeast Asia
Malaysian palm oil closed lower.
- Notably, the benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange lost 1.69% by the close.
- Dalian’s most-active soyoil contract down 0.44%, while its palm oil contract slipped 2.77%.
- Cargo surveyors estimated Malaysian palm oil exports to have fallen between 15.5% and 23.7% during Jan 1-15, from a month earlier.
- India’s palm oil imports in December plunged 41% month on month to a nine-month low, as prices touching a 2-1/2-year high prompted refiners to stock up on rival soyoil available at a discount, a leading trade body said.
- Limiting losses, oil prices rose making palm a more attractive option for biodiesel feedstock.
- The Malaysian ringgit traded largely flat against the US dollar, meantime.
- This morning, according to a circular posted by the Malaysian Palm Oil Board on its website, Malaysia has maintained its February export tax for crude palm oil at 10% while lowered its reference price.
- Notably, Malaysia calculated a reference price of 4,817.70 ringgit ($1,071.79) per metric ton for February.
- The January reference price was 5,001.72 ringgit a ton.
- The export tax structure starts at 3% for crude palm oil in a 2,250 to 2,400 ringgit-per-ton range.
- The maximum tax rate is set at 10% when prices exceed 4,050 ringgit a ton.
Australia
Prices for feed wheat and barley have moved little since mid-December as growers focus on pricing and delivering pulses and canola, and consumers rest on coverage previously booked for coming weeks.
- In the northern region, some growers are just starting to harvest an early sorghum crop, their next cash earner after chickpeas and faba beans.
- A bumper wheat and barley harvest in central and northern New South Wales, and southern Queensland, has largely been warehoused or stored on farm if bids from up-country consumers were deemed too low to send it straight to consumer.
- In Victoria and southern NSW, growers are believed to have sold much of their canola, lentils, malting barley, and higher-protein wheat as cash crops.
- Meantime, WA canola bids were slightly down, to $875 FIS.
- Canola bids in the east were off by around $3, to around $819.
- WA wheat was firmer, bid $380, with barley around $328, showing a few dollars’ variance by PZs.
- Eastern wheat was largely unchanged around $345, and barley $304.
- Delivered wheat markets were well bid yesterday, with buying competition predominantly for ASW.
- Up-country homes were trading at approximately $365 delivered Melbourne equivalent, in contrast to the track market, which remains lacklustre.
- There is still good packer demand for GM canola into Melbourne/Geelong, with bids around $710.
International grain and oilseed tenders & trade
- Jordan’s state grains buyer has issued an international tender to purchase up to 120,000 metric tons of animal feed barley. The deadline for submission of price offers in the tender is Jan. 22. A new announcement had been expected after Jordan made no purchased in its previous tender for 120,000 tons of barley on Wednesday.
Outside markets ...
Oil prices rose more than 2%.
- Notably, Brent crude futures settled 2.64%, higher, hitting their highest level since August 2024.
- U.S. West Texas Intermediate crude settled up 3.28%, reaching the highest since July.
- In post settlement trade, Brent rose to the highest since July and WTI gained more than $3 a barrel.
- A large draw in U.S. crude stockpiles and potential supply disruptions caused by new U.S. sanctions on Russia, supported prices.
- U.S. crude oil stocks excluding the Strategic Petroleum Reserve fell last week to their lowest since April 2022 as exports rose and imports fell, the EIA said.
- Notably, crude inventories fell by 2 million barrels to 412.7 million barrels in the week ending Jan. 10, data showed.
- Net U.S. crude imports fell by 1.3 million barrels per day (bpd), to 2.05 million bpd.
- Meanwhile, weekly crude exports were up 1 million bpd to 4.08 million bpd.
- Refinery crude runs fell by 255,000 bpd in the week, the EIA said.
- Refinery utilization rates fell by 1.6 percentage points 91.7%.
- Meantime, U.S. gasoline stocks rose by 5.9 million barrels to 243.6 million barrels, the EIA said.
- Gasoline supplied fell to 8.33 million bpd last week, down from 8.48 million bpd.
- Distillate stockpiles rose by 3.1 million barrels to 132 million barrels, their highest since January 2024, the EIA data showed.
- Supporting prices, also the International Energy Agency saying in its monthly oil market report, "the latest round of U.S. sanctions on Russian oil could disrupt Russian oil supply and distribution significantly".
- In addition, the dollar index slipped, making the US dollar named commodity more competitive in the international market.
- Meanwhile, OPEC expects global oil demand to rise by 1.43 million barrels per day in 2026, maintaining a similar growth rate to 2025, the producer group said.
- A Gaza ceasefire deal limited gains.
This morning, oil prices steadied.
- Brent crude futures were down 0.3%, by 0915 GMT, while U.S. West Texas Intermediate crude futures slid 0.2%.
The Baltic Exchange's main sea freight index eased for the second session in a row, amid lower rates across all vessels.
- Notably, the main index fell 17 points to 1,063 points.
- The capesize index dropped 23 points to 1,581 points.
- The panamax index decreased 12 points to 894 points, marking the sixth straight session of declines.
- The supermax index slumped 15 points to a 17-month low of 783 points.
- Separately, oil shipping rates extended their rally on expectations of a tightening in global tanker supply from wider US sanctions on Russia's fleet and traders' demand for ships to load Middle East oil for Asia.
U.S. stock indexes rallied sharply.
- The Dow Jones Industrial Average rallied 1.7%, the S&P 500 jumped 1.8%, and the Nasdaq composite leaped 2.5%.
- The US Dec CPI rose to +2.9% y/y from +2.7% y/y in Nov.
- Dec CPI ex-food and energy unexpectedly eased to +3.2% y/y +3.3% y/y in Nov.
- The US Jan Empire manufacturing survey of general business conditions fell -14.7 to an 8-month low of -12.6.
- US MBA mortgage applications rose +33.3% in the week ended January 10.
- The purchase mortgage sub-index was up +26.9% and the refinancing mortgage sub-index +43.5%.
- The average 30-year fixed rate mortgage rose +10 bp to an 8-month high of 7.09% from 6.99% in the prior week.
- Stocks extended gains after an upbeat Fed Beige Book showed economic activity increased "slightly to moderately" across the US in late November and December.
- Better-than-expected quarterly earnings results from big US banks also boosted the overall market.
- Wells Fargo jumped 6.7%, Citigroup rallied 6.5% and Goldman Sachs gained 6%.
- Meantime, the 10-year T-note yield fell -13.5 bp to 4.657%.
- In Europe, the Euro Stoxx 50 closed up +1.04%.
- Eurozone Nov industrial production rose +0.2% m/m.
- UK Dec CPI unexpectedly eased to +2.5% y/y from +2.6% y/y in Nov.
- Dec core CPI eased to +3.2% y/y from +3.5% y/y in Nov.
- In China, the Shanghai Composite Index closed down -0.43%.
- Japan’s Nikkei Stock 225 fell closed down -0.08%.
- Japan Dec machine tool orders rose +11.2% y/y, the largest increase in 2-1/2 years.
This morning, Asian shares mostly rose.
- Japan's benchmark Nikkei 225 added 0.5%, the Hang Seng in Hong Kong gained 1.2%, the Shanghai Composite index rose nearly 0.3%, Australia's S&P/ASX 200 surged 1.4%, South Korea's Kospi gained 1.2%.
- Bank of Japan data showed wholesale prices in Japan rose 3.8% in December last year compared to a year earlier.
The dollar index fell, with the dollar posting moderate losses.
- US Dec CPI report showed an unexpected easing of core inflation.
- That pushed T-note yields lower.
- Also, the US Jan Empire manufacturing survey of general business conditions unexpectedly fell to an 8-month low.
- In addition, a sharp rally in stocks reduced liquidity demand for the dollar.
- However, hawkish comments from New York Fed President Williams and Richmond Fed President Barkin, who said it would take more time for inflation to fall to the Fed’s target, supported the greenback.
- The dollar also garnered some support from the Fed Beige Book, which said economic activity increased “slightly to moderately” across the US.
- Meantime, the EUR/USD rose.
- The Eurozone Nov industrial production rose as expected.
- However, gains in the euro were limited due to dovish comments from ECB Vice President Guindos.
- On the other hand, the USD/JPY fell, with the yen rallying to a 3-1/2 week high against the dollar after comments from BOJ Governor Ueda bolstered speculation the BOJ will raise interest rates next week.
- The yen also garnered support data showed Japan Dec machine tool orders rose by the most in 2-1/2 years.
This morning, the U.S. dollar declined to 156.18 Japanese yen from 156.47 yen. The euro cost $1.0288, down from $1.0289.
Settlement Prices for Key Commodity, Index & Currencies
- Chicago wheat Mar contract was up 0.6c/bu to 547c/bu;
- Kansas wheat Mar contract was down 3.2c/bu to 557.4c/bu;
- Minneapolis wheat Mar contract was down 2c/bu to 587.4c/bu;
- MATIF wheat Mar was down €3/t to €228.25/t;
- ASX wheat Mar contract was down A$1/t to A$328/t;
- US DWI Cash (durum wheat index) was up 2.72c/bu to 651.47c/bu;
- 1CWAD (Canadian durum) avg spot price was down C$0.12 /t to C$322.80/t.
- EDW (EU durum) Mar contract was unchanged to €316.5/t;
- Chicago corn Mar contract was up 4.2/bu to 478.6c/bu;
- MATIF corn Mar was down €2/t to €213.75/t;
- Chicago soybeans Mar was down 4.6c/bu to 1,042.6c/bu;
- Winnipeg canola Mar contract was down C$11.5/t to C$630.1/t;
- MATIF rapeseed Feb was down €1/t to €536.25/t;
- Brent crude Mar was up US$2.11/barrel to $82.03;
- WTI crude Feb was up US$2.54/barrel to $80.04;
- BADI (Baltic Dry Index) was down 17 points to 1,063;
- Dow Jones was up 703,27 points to 43.221,55;
- S&P 500 was up 107 points to 5.949,91;
- NASDAQ Composite was up 466,84 points to 19.511,23;
- US dollar index (Mar '25) was down 0.194 points to 108.916;
- AUD/USD firmer at US$0.6226;
- USD/CAD weaker at $1.4340;
- EUR/USD weaker at $1.0289;
- USD/RUB weaker at ?102.4931.
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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