January 10, 2024 - Newswires

Corn and soybeans ticked up, as traders squared positions ahead of the monthly WASDE report; Wheat fell as the U.S. dollar extended recent gains ...

Good morning, Farmer Family ...

US farm markets ended mixed on Thursday.

Corn prices picked up 0.44%.

Soybeans rose 0.45%.

The rest of the soy complex was mixed as soymeal dipped 0.5%, while soyoil jumped 2.81%.

Wheat prices continued to face downward pressure, with Chicago SRW falling 0.42%, Kansas City HRW ending unchanged, while Minneapolis spring wheat eased 0.26%.

• Corn and soybeans ticked up, as traders squared positions ahead of a major U.S. Department of Agriculture supply-and-demand report due later in the session.

• USDA will release their annual Crop Production report, with analysts looking for a 0.4 bpa cut in corn to yield at 182.7 bpa.

• Corn production is seen down 48 mbu to 15.095 bbu, as harvested acres are expected to see a slight reduction.

• Grain Stocks data will also be released with traders looking for December 1 corn stocks at 12.147 billion bushels, down 24 mbu from last year if realized.

• The WASDE report is expected to peg the US ending stocks total at 1.675 bbu.

• On the world side analysts are expecting to see very few changes to the Brazilian crop at 127 MMT, with the Argentina crop seen down 0.5 MMT to 50.5 MMT.

• Corn ending stocks for the world are seen at 294.80 MMT, a drop of 1.64 MMT from December.

• For soybeans, the trade is looking for US bean yield to be down 0.1 bpa to 51.6 bpa.

• Soybean production is seen down 8 mbu to 4.453 bbu, as harvested acres are estimated to be slightly higher from the November report.

• The Grain Stocks report will also be released with estimates at 3.231 bbu, 231 mbu above December 1, 2023.

• The WASDE report is estimated to show US soybean ending stocks at 457 mbu.

• On the world side analysts are looking for the Brazilian crop to be up 1.28 MMT to 170.28 MMT, with the Argentina crop seen down just slightly MMT at 51.91 MMT.

• Soybean ending stocks for the world are seen at 132.20 MMT, an increase of 0.33 MMT from December.

• Meanwhile, wheat prices fell as the U.S. dollar extended recent gains.

• Ahead of the Winter Wheat Seedings report, the trade is expecting USDA to show all winter wheat acreage at 33.366 million acres, down 24,000 acres from last year if realized.

• HRW is expected to be 23.73 million, with SRW at 6.14 million acres and white at 3.49 million acres.

• December 1 Grain Stocks data will also be released, with the trade looking for 1.565 bbu in wheat stocks.

• That would be up 144 mbu from last year if realized.

• The ending stocks projection is expected to be up 4 mbu to 799 mbu.

• World wheat ending stocks are estimated at 257.86 MMT, which would be nearly even with the 257.88 MMT from last month.

• In other news, La Nina conditions are present and there is a 59% chance of it persisting through February-April 2025, with a 60% chance of transition to ENSO-neutral conditions during March-May 2025, a U.S. government forecaster said on Thursday.

• Also, it should be noted that the market closed early yesterday, to mark the funeral of former U.S. President Jimmy Carter.

• As a result, the weekly Export Sales report has been delayed until Friday as the government offices were closed.

In this context ...

• Corn basis bids tracked 5 cents higher at an Illinois river terminal and 3 cents lower at another Illinois river terminal while holding steady elsewhere across the central U.S..

• Soybean basis bids were steady to mixed across the central U.S. after trending as much as 3 cents higher at an Illinois river terminal and as much as 5 cents lower at an Iowa processor.

• Basis bids for hard red winter wheat were steady to lower in the U.S. Plains, with dealers citing little movement and slow trade.

• The basis fell at a location in the U.S. Gulf.

• Protein premiums for HRW wheat shipped by rail to or through Kansas City rose by two cents for wheat with 12.4% protein and decreased by 12 cents for wheat with 13% to 13.6% protein.

This morning ...

Chicago soyoil prices rallied to a five-week peak, and were on course for a 9.9% weekly jump, following expectations of President Joe Biden’s administration releasing short-term guidance on clean fuel tax credits.

• Soybean and corn prices also rose and were headed for weekly gains.

• Wheat prices slipped as traders struggled to find bullish drivers, with a stronger US dollar adding pressure.

• Notably, the most-active soybean oil contract for March delivery on the Chicago Board of Trade added 2.55%, by 0408 GMT.

• Chicago soybean rose 0.08% at $10.00 a bushel.

• For the week, the contract has risen 0.8%, up for a third week.

• Chicago corn gained 0.16%, and was set for a 1.3% weekly rise - its seventh weekly gain in eight weeks.

• Wheat fell 0.09%, but was set for a 0.8% weekly rise.

South America

Argentina

Rains are needed to refresh Argentina's parched soy and corn crops, the Buenos Aires Grain Exchange said, after weeks of hot and dry weather.

• Showers should come within the next week, the exchange's weather analyst said.

• Notably, the exchange expects 50-75 millimeters of rain to fall on the agricultural region between Jan. 16 and 22.

• Meantime, about the soybean crop, nearly 92% of an expected 18.4 million hectares have been planted with soy so far, the exchange said.

• For corn, farmers have also planted around 92% of the crop, expected to cover 6.6 million hectares.

• But the corn crop, is starting to show "water stress and loss of yield potential," according to the exchange.

• The share of Argentine corn crops in poor condition, indeed, increased to 9% from 4% a week earlier, and 5% a year ago, according to data from the Buenos Aires Exchange.

• While the corn and soy crops are growing, wheat harvesting is nearly wrapped up, the exchange said.

• An estimated 98.2% of wheat fields have been threshed, with output seen at 18.6 million metric tons, according to the exchange.

• "Average yield continues to increase as the harvest progresses" the exchange said.

Europe

European grain markets ended mixed.

• Benchmark March milling wheat on Paris-based Euronext settled 0.7% down at 229.25 euros ($236.01) per metric ton.

• The contract earlier touched a two-week low at 228.75 euros but held chart support around that level.

• MATIF Mar corn closed unchanged to €211.25/t, while Feb rapeseed ended up €4.25/t to €533.25/t.

• Wheat eased, curbed by weakness in Chicago futures as traders adjusted positions before widely followed U.S. government crop data.

• However, weakness in the euro has lent some support to Euronext.

• Also, news that Morocco increased its monthly wheat import subsidy has raised hopes of fresh demand.

• A couple of cargoes of German wheat had been sold to Morocco this week for prompt shipment.

• In France, 27,000 tons of wheat were loaded at Rouen last week for Morocco in an otherwise quiet period for wheat exports, data from the port showed.

• A large shipment of barley for Jordan was scheduled for later this month at Rouen and Dunkirk in a rare loading of French grain for the Middle Eastern country, LSEG data showed.

• But cheap supplies from Argentina were bringing further competition in wheat on top of Black Sea grain.

• In corn, Euronext issued a notice reiterating limits on mycotoxins in crop delivered against its corn futures, following a rainy French harvest that has led to reports of increased presence of the toxic substances.

• Corn quality in France has been a market concern after heavy rain hampered autumn harvesting and traders cited reports of increased presence of mycotoxins.

• However, unlike wheat, for which French production slumped to its lowest since the 1980s, the country's corn output is estimated to have risen sharply with rain helping growth during summer.

Russia

Russia’s grain exports in 2024 totaled 86.7 MMT, according to a report from Rosselkhoznadzor.

• Notably, wheat sales totaled 57.5 MMT.

• Barley sales totaled 8.2 MMT.

• Corn sales totaled 6.7 MMT.

• Total volume of grain exports were 2.8 million metric tons above 2023’s total.

Southeast Asia

Malaysia

Malaysian palm oil prices fell, extending losses for a second straight session, as sluggish demand pressured prices.

• Notably, the benchmark palm oil contract for March delivery on the Bursa Malaysia Derivatives Exchange slid 1.36%, by the close.

• Traders were awaiting signs of market recovery after the recent rout, however, demand remains weak and continues to put pressure on prices.

• Authorities in Indonesia have also been looking into ways to curb used cooking oil exports, though the extent of the tightening is not immediately clear.

• Meantime, Dalian’s most-active soyoil contract fell 1.16%, while its palm oil contract lost 3.09%.

This morning, Malaysia’s palm oil stocks at the end of December fell 6.91% from a month earlier to a 19-month low of 1.71 million metric tons, the Malaysian Palm Oil Board (MPOB) data showed.

• Malaysia’s palm oil stocks fell for a third consecutive month, as output dropped due to floods.

• Crude palm oil production was down 8.3% to 1.49 million tons, the lowest since March 2024, while palm oil exports fell 9.97% to a six-month low of 1.34 million tons.

• Malaysia’s palm oil consumption jumped 53% in December from a month earlier to 309,865 tons, the data showed.

• The drop in Malaysian inventories could support benchmark futures.

International grain and oilseed tenders & trade

• Algerian state agency ONAB is believed to have made no purchase in a tender which closed on Tuesday for up to 240,000 metric tons of corn to be sourced only from Argentina or Brazil. The corn was sought in six consignments of between 30,000 and 40,000 tons each for prompt shipment during Jan. 15-31. However, it was believed about 60,000 tons of soymeal also sought in the tender was bought in two consignments to be sourced from optional origins.

Outside markets ...

Energy markets

Oil prices rose more than 1%, recouping most losses the previous session.

• Notably, Brent crude futures settled up 1%, while U.S. West Texas Intermediate crude futures settled up 0.82%.

• Cold weather gripped parts of the United States and Europe, boosting winter fuel demand.

• Parts of east Texas up to west Virginia were under a winter storm warning, according to the National Weather Service, covering large swathes of Arkansas, Tennessee and Kentucky.

• Ultra-low sulfur diesel futures were trading at around $2.38 a gallon, their highest since Oct. 8, according to data from LSEG.

• Supporting prices, U.S. President Joe Biden is expected to announce new sanctions targeting Russia's economy this week, according to a U.S. official.

• Uncertainty over how hawkish Trump will be with Iran also provided some support.

• The dollar, however, strengthened further capping gains.

This morning, oil prices rose in early Asian trade and were on track for a third straight week of gains.

• Notably, Brent crude futures climbed 0.5%, at 0602 GMT, while U.S. West Texas Intermediate crude futures gained 0.5%.

• Over the three weeks ending Jan. 10, Brent has advanced 6% while WTI has jumped 7%.

Ocean freight markets

The Baltic Exchange's main sea freight index picked up, snapping its three-day losing streak, buoyed by the bigger size segment.

• Notably, the main index rose 3 points to 969 points.

• The capesize index increased 64 points to 1,164 points.

• Meanwhile, the panamax index fell by 45 points to 992 points.

• The smaller supramax index eased 16 points to its lowest since August 2023 at 830 points.

Equity markets

U.S. markets were closed yesterday to observe a National Day of Mourning for former President Jimmy Carter.

• In European trading, London’s FTSE 100 climbed 0.8%, as the value of the British pound slid against the U.S. dollar amid worries about the United Kingdom’s economy and its government’s finances.

• A weaker pound can boost profits for U.K. exporters, which can goose their stock prices.

• Germany’s DAX lost 0.1%, while France’s CAC 40 added 0.5%.

This morning, shares fell in Asian trading

• In Tokyo, the Nikkei 225 index lost 0.9%, South Korea's Kospi was flat, the Hang Seng in Hong Kong down 0.5%, and the Shanghai Composite index also fell 0.5%, extending losses the previous session.

• In Australia, the S&P/ASX 200 gave up 0.5%, Bangkok's SET was nearly unchanged, the Sensex in India fell 0.4%, while Taiwan's Taiex edged 0.2% higher.

• Uncertainties over how aggressively might pursue higher tariffs against China and other countries once President elected Trump takes office also have left investors cautious just days ahead of the Jan. 20 inauguration.

Currency trading

The dollar index strengthened for a third straight session.

• Notably, the dollar index, rose 0.12% to 109.15, with the euro down 0.16% at $1.0301.

• Sterling weakened 0.46% to $1.2306, on track for a third straight session of declines after hitting its lowest level since Nov. 13, 2023.

• The Japanese yen, on the other hand, strengthened 0.17% to 158.06 per dollar.

• US Treasury yields dipped but held at elevated levels on concerns over tariffs under the incoming Trump administration, while sterling's recent weakness persisted.

• Federal Reserve Bank of Boston President Susan Collins said that significant uncertainty over the outlook calls for the central bank to move forward cautiously with future rate cuts.

• Britain's finance minister was under pressure as concerns over Trump's policies have pushed the British government's borrowing costs higher.

• Bank of England Deputy Governor Sarah Breeden said a rate cut was supported by recent evidence, although it was difficult to know how quickly.

• Japanese government data showed Japan's inflation-adjusted real wages fell for the fourth straight month in November, weighed down by higher prices even as base pay grew at the fastest pace in more than three decades.

• Analysts at Goldman Sachs believe the discussions at the January branch managers meeting support their view of a January rate hike from the Bank of Japan.

This morning, the U.S. dollar rose to 158.40 Japanese yen from 158.14 yen. The euro slipped to $1.0298 from $1.0301.

Settlement Prices for Key Commodity, Index & Currencies

• Chicago wheat Mar contract was down 2.2c/bu to 534c/bu;

• Kansas wheat Mar contract was unchanged to 550.2c/bu;

• Minneapolis wheat Mar contract was down 1.4c/bu to 583.4c/bu;

• MATIF wheat Mar was down €1.5/t to €229.25/t;

• ASX wheat Mar contract was down A$2.8/t to A$321/t;

• US DWI Cash (durum wheat index) was not quoted;

• 1CWAD (Canadian durum) avg spot price was up C$0.01 /t to C$321.05/t.

• EDW (EU durum) Mar contract was down €4/t to €316.5/t;

• Chicago corn Mar contract was up 2/bu to 456c/bu;

• MATIF corn Mar was unchanged to €211.25/t;

• Chicago soybeans Mar was up 4.4c/bu to 999c/bu;

• Winnipeg canola Mar contract was down C$3.6/t to C$624.9/t;

• MATIF rapeseed Feb was up €4.25/t to €533.25/t;

• Brent crude Mar was up US$0.76/barrel to $76.92;

• WTI crude Feb was up US$0.60/barrel to $73.92;

• BADI (Baltic Dry Index) was up 3 points to 969;

• Dow Jones the market was closed;

• S&P 500 the market was closed;

• NASDAQ Composite the market was closed;

• US dollar index (Mar '25) was up 0.078 points to 109.004;

• AUD/USD weaker at US$0.6195;

• USD/CAD firmer at $1.4395;

• EUR/USD weaker at $1.0299;

• USD/RUB weaker at ₽102.2478.

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 ...

Note:

This newsletter is a free version of a market report created by the "Author" solely for informational purposes.

On the date of publication, the "Author" did not have (either directly or indirectly) positions in any of the securities mentioned here.

Please note that the Author's ability to deliver original, industry-specific, timely news and important information free-of-charge to a large and growing audience, depend only by your donations.

Therefore, if you enjoy the content published here, please consider making a voluntary donation to:

Puglisi Sandro Filippo

IBAN: IT 64 K 3608 10513 8244696644702

BIC/SWIFT: PPAYITR1XXX

For your backing and commitment, we are extremely grateful!

Thank you ...!