CORN HIGHLIGHTS:

• Corn futures rebounded Monday, aided by a weaker U.S. dollar and strong wheat prices. March corn retested $4.60 but failed to hold, ending moderately higher.
• The U.S. Dollar Index fell, driven by a strong Canadian dollar following President Trudeau’s resignation. The weaker dollar supported wheat and spilled over to corn.
• Weekly corn export inspections were very routine in Monday’s report at 847,000 MT (33.6 mb), down slightly from the previous week’s totals. Total inspections for the 2024-25 marketing year are now at 639 mb, up 24% from the previous year.
• Dry and hot weather forecasts for mid-January in Argentina remain a key market focus. Long-range forecasts into late January will likely drive corn and soybean price action.
• The January WASDE and Quarterly Grain Stocks reports on January 10 will be pivotal for stockpile and demand insights, with choppy trading expected ahead of the release.

SOYBEAN HIGHLIGHTS:

• Soybeans opened the week with higher prices as soil moisture levels continue to decline across many regions of Argentina. Growing concerns about rising temperatures and inadequate rainfall are raising the risk of significant challenges for the crop.
• Part of the strength in the soy complex is driven by anticipation ahead of Inauguration Day, as President-elect Trump considers widespread tariffs on several countries, creating uncertainty in the markets. This news resulted in a sharp decline in the U.S. dollar overnight, while boosting commodity prices.
• Soybean meal ended the day with a decline as cold weather and heavy snowstorms swept through the Midwest over the weekend. These weather conditions disrupted soybean processing operations, leading to delays in both production and transportation.
• Farmers in Brazil have reportedly sold 35% of their expected soybean production, up from 20% at this time last year and surpassing the 10-year average of 30%. This increase is partly attributed to the Brazilian currency’s decline to an all-time low against the U.S. dollar.

WHEAT HIGHLIGHTS:

• Wheat futures recouped Friday’s losses, with March KC and Minneapolis contracts leading the rally, while Chicago March wheat closed below Friday’s high. A sharp drop in the U.S. Dollar Index supported U.S. wheat, despite lower Matif wheat prices.
• Weekly wheat inspections at 15.2 mb bring the total 24/25 inspections figure to 467 mb, which is up 25% from the year prior. Inspections are running above the USDA’s estimated pace, and exports are estimated at 850 mb, up 20% from last year.
• Argentina’s wheat crop is 94.7% harvested, up 6.2% week-over-week, with production estimates steady at 18.6 mmt, compared to 15.1 mmt last year.
• Indonesia may impose feed wheat import quotas to protect domestic corn farmers. Despite this, 2023/24 wheat imports are projected at 12.98 mmt, up from 9.45 mmt last year, according to USDA FAS.

DAIRY HIGHLIGHTS:

• Another strong day of bidding in the cheese market took the block/barrel average up to a close of $1.9075/lb. This is it’s best finish since October 30th.
• Class III milk futures responded well to the cheese price jump and took the February, March, and April contracts up to new contract highs.
• After the market closed, the USDA reported that US cheese production in November fell 1.70% from last year. Cheese inventories are already light as is, so the tighter production won’t help matters.
• The Class IV spot products had a decent up day with butter finding a 1.75c higher bid while powder gained 0.25c.
• The next market event on the calendar is tomorrow’s Global Dairy Trade auction. The most recent event saw the GDT price index fall 2.80%, so it’ll be interesting to see how the global market reacts this week.

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Author

John Heinberg