CORN HIGHLIGHTS:

• The corn market used strength in the wheat market to gain back yesterday’s losses as the market overall trades in a sideways fashion. March corn futures were 2 ¼ cents higher to 424, while the May contract added 2 ½ cents to 432 ¼.
• A strong winter storm forecast for the Midwest Corn Belt could provide temporary support to the corn market, while snow, ice, and cold temperatures may limit transportation.
• USDA will release weekly export sales totals for the week ending January 15 on Friday morning. The expected range for the week is 1.5 MMT to 3.1 MMT. The total could be strong with already over 1.4 MMT in known sales that were triggered after the USDA report on January 12.
• Legislation to expand E15 nationwide has been removed from the Appropriations Budget Bill, but it may be included in a supplemental bill later this year. Any such legislation would not mandate E15 but would clear the pathway for its national adoption.
• Weekly ethanol production dropped back to normal production ranges for the week after a spike in last week’s report. For the week ending January 16, ethanol production dropped to 329 million barrels for the week, down from 352 million barrels the previous week. A total of 111 mb was used for production last week, which stayed slightly ahead of the USDA target.

SOYBEAN HIGHLIGHTS:

• Soybeans were mixed to end the day after they once again tested a break above the 200-day moving average and then failed, drifting lower into the close. March was the only contract to close lower and was down ½ cent to $10.64 while November soybeans gained 2-3/4 cents to $10.77-1/4. March soybean meal gained $4.80 to $296.20, and soybean oil lost 0.23 cents to 53.78 cents.
• This morning, private exporters reported a sale of 192,350 metric tons of soybeans for delivery to unknown destinations. This is rumored to be Mexico. Soybean harvest in Brazil is underway but has been slightly delayed which could leave the export window for the U.S. open for a longer period.
• Weather models continue to favor a wetter pattern across central Brazil, easing near-term production concerns as soybeans enter the critical pod-filling stage. Southern Brazil and Argentina, however, are forecast to trend drier than normal over the next 10 days.
• Today, funds were likely taking profits on the long soybean oil/soybean meal spread, which supported the rally in soybean meal. Yesterday, soybean oil found support on optimism over increased biofuel demand.

WHEAT HIGHLIGHTS:

• Wheat led the grain complex higher today, likely reflecting concerns about crop damage from extreme cold expected across much of the central U.S. Areas without snow cover face increased winterkill risk, while drought conditions should ease where precipitation occurs. Additionally, a drop in the U.S. dollar today may have given a boost to the wheat market. March Chicago gained 7-3/4 cents to 515-1/2, Kansas City was up 6 at 525-3/4, and MIAX closed 10 higher at 573-3/4.
• SovEcon has kept their Russian wheat production forecast unchanged at 83.8 mmt. However, they stated that the current cold pattern could cause them to lower it, if it persists for too much longer. For reference, the USDA raised their Russian wheat forecast by 2 mmt on last week’s report, to 89.5 mmt.
• Diplomats from the U.S., Russia, and Ukraine are expected to meet in the UAE later this week to discuss negotiations toward a ceasefire.
• According to LSEG commodities research, their U.S. 26/27 wheat production figure was kept unchanged at 51.7 mmt. They also estimate winter wheat planted area at 33.01 million acres, which is just slightly above the USDA at 32.99 million.
• According to the USDA, an estimated 42% of U.S. winter wheat acres are experiencing drought conditions as of January 20. This is up 1% from the week prior. Additionally, spring wheat acres in drought were unchanged at 10% for the same time period.

DAIRY HIGHLIGHTS:

• Class III milk headed lower today with the February contract giving back 31 cents to move to $15.00.
• Spot cheese was down a half cent today, entering Friday with 3 cents of gains at $1.35375/lb, while whey was unchanged today and from last Friday.
• Buyers pushed Class IV milk higher with February garnering 22 cents of gains for a $14.67 settlement.
• While butter was unchanged today, it sits 10.50 cents higher on the week so far. Spot powder was up 2.25 cents today to move to $1.2825/lb.

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Author

John Heinberg