- Quiet day in the corn market, but futures found some footing for the first time in a week. March corn gained 1 ½ cents on the session as overall news was lacking in the corn market.
- Weekly export inspections were within estimates at 34.6 mb (880,00 mt). Total inspections for 23/24 are now at 677 mb, which is up 31% from last year. The corn market is starting to hit a window where the inspection numbers should and need to increase weekly.
- Managed funds are still pushing the short side of the market. On last week’s Commitment of Traders report, managed funds added 17,593 net short positions to increase their net short position to 297,744 total contracts.
- Rainfall in Argentina over the weekend has stabilized the crops in many areas. The forecast is staying supportive grain development as adequate moisture stays in the forecast.
- Soybeans ended the day higher to start the week after a poor showing last week with the WASDE report pressuring prices. Soybean meal ended the day higher, while soybean oil was lower with some possible pressure from lower heating oil.
- This morning, the USDA reported total soybean export inspections at 48.7 mb for the week ending Thursday, February 8. This was near the higher end of the estimated trade range which likely added support today. Total inspections are now at 1,131 mb for 23/24 which is down 23% from the previous year.
- Funds hold a large net short position in soybeans and sold an additional 22,053 contracts as of February 6, leaving them with a net short position of 130,300 contracts. With the market oversold and funds so short, some short covering may have taken place today.
- Over the weekend, Argentina benefited from much needed rain in some of the drier areas, while Brazil received scattered showers as well. Private analysts are still expecting Brazilian soy production to be lower than USDA estimates with many projecting total production around 149 mmt.
- US wheat closed mostly lower in all three classes today, with the exception being March and May Chicago wheat. The former gained less than a penny, while the latter was neutral. Paris milling wheat also closed lower for the session, offering some weakness to the US market. Competitive Russian exports continue to act as the main anchor; their FOB values are said to be around $235 per mt, which is up from last week, but well below the $250 area at the end of December.
- Weekly wheat inspections at 15 mb bring total 23/24 inspections to 430 mb. That is down 18% from last year and current inspections are behind the USDA’s projected pace. On last week’s WASDE report, they left their estimate of 23/24 wheat exports unchanged at 725 mb.
- Ukraine’s Ag Minister said that their winter wheat acres are down compared to last year, which along with the grain quality and economic issues they are facing may lower production. However, their spring wheat acreage may be higher and potentially reduce that concern.
- According to the CFTC, as of February 6, the fund short position in Chicago wheat increased by about 3% from the previous data on January 30. The net short went from 64,818 to 66,738 contracts. The net short Kansas City wheat position was virtually unchanged for the same time period at around 33,000 contracts. While over in the Minneapolis wheat, funds covered 1,174 contracts, almost 5%, of their net short positions to bring their net short position to 25,906 contracts.
- Later this week the USDA will hold their annual Ag Outlook Forum. While the numbers they will give are by no means official estimates, the trade will likely react to them anyways. Last year the forum’s estimate of wheat acreage was 49.5 million, which was in line with the actual 49.6 ma planted.
- Cheese blocks added 1.50c and barrels recovered 1.75c on Monday, aiding a higher Class III trade.
- March ’24 Class III finished the session up 28c to $17.26, and had been up as much as 54c before a cheese seller took the barrel market off of the high of day.
- After falling 5.50c during last week’s trade, spot butter began this week on the right foot. The market recovered 2.25c and closed back up at $2.7125/lb.
- News this week will be light on the dairy front. There are no major monthly reports expected and the next Global Dairy Trade auction isn’t until next week.
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