CORN HIGHLIGHTS:

• Corn futures found support on Wednesday as buyers stepped back in, erasing most of Tuesday’s losses despite overall grain market weakness. Strong demand continues to underpin prices.
• The corn market was disappointed in the lack of changes on Tuesday’s USDA Supply/Demand report, but traders may have stepped into the corn market on the belief that the USDA will need to reduce carryout in future reports as both export and ethanol demand have remained strong.
• The USDA announced a flash corn export sales on Wednesday morning. USDA stated that unknown destinations purchased 130,320 mt (5.1 mb) of corn for the current marketing year.
• On Thursday morning, the USDA will release weekly corn export sales totals. Expectations for the week ending Feb 6, the new exports sales range from 800,000 – 1.7 MMT. Last week’s sales totaled 1.477 MMt as U.S. corn export demand has remained supportive.
• Weekly ethanol production fell to 1.082 million bpd in the week ending February 7. This was down from 1.112 million bpd the previous week.  Corn used in the production of ethanol was estimated at 104.3 million bushels for the week.  The current pace is still trending ahead of the target set by the USDA for the marketing year.

SOYBEAN HIGHLIGHTS:

• Soybeans extended their losses for a second consecutive session following Tuesday’s WASDE report, which left U.S. carryout unchanged despite trade expectations for a decline. Pressure continues from Brazil’s ongoing harvest and signs of a peak in soybean prices on China’s Dalian exchange. Both soybean meal and oil closed lower.
• Private exporters reported a sale of 120,000 metric tons of soybeans to unknown destinations for the 2024/2025 marketing year this morning. However, U.S. export sales have begun to slow as Brazil’s export season gains momentum.
• In China, soybean futures on the Dalian exchange may be topping out. In addition, Brazilian soybeans are 80 cents cheaper per bushel compared to the US. China has primarily been a buy of Brazilian and Argentinian soybeans.
• Weather in Argentina has improved with rain falling and more in the forecast. While the USDA reduced their estimates for Argentinian soybean production yesterday, a large crop is still expected, and Argentinian soybean meal prices have reached their lowest levels since Covid.

WHEAT HIGHLIGHTS:

• Wheat futures fluctuated throughout the session but ultimately closed with small losses, pressured by weaker soybean prices, easing winterkill concerns, and reports of potential Ukraine-Russia peace negotiations. A sharp decline in Matif wheat futures also failed to offer support to U.S. prices.
• The snowstorm moving across the central US should provide snow cover to help insulate much of the winter wheat crop before the upcoming frigid temperatures. This has reduced the concern on traders’ minds of damage to the winter wheat crop. Furthermore, the Black Sea region is expected to receive good snow cover to help protect their wheat too.
• News outlets have reported that President Trump had a phone call today with Putin, in which they discussed the Ukraine war among other topics. Reportedly, Putin has agreed to begin negotiations to end the war. And though Ukraine has already been highly successful in shipping grain in the face of logistics issues, this still may be perceived as negative to prices.
• According to the European Commission, EU soft wheat exports as of February 9 have reached just 13 mmt since the season began on July 1. This represents a 36% drop from the 20.4 mmt shipped for the same timeframe last year.

DAIRY HIGHLIGHTS:

• Class III milk futures traded lower midweek, with the March contract finishing 7 cents lower to close at $19.78, while the April contract dropped 6 cents to settle at $19.37.
• Spot Cheese was able to make some gains today closing up 1.125 cents to close at $1.87375/lb. While spot whey closed unchanged at $0.5675/lb.
• Spot Butter closed down 2.5 cents at $2.4050/lb. Spot powder ended unchanged at $1.300/lb.
• Class IV milk futures had a very light day of trading with only 31 contracts being traded in total for 2025, with the majority closing in the red.

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Author

John Heinberg