CORN HIGHLIGHTS:

• The corn market fought off early session lows to finish slightly higher on the session. Strength in the wheat and crude oil markets helped support corn markets on Tuesday.
• Managed money has stayed an active buyer in the corn market. The most recent Commitment of Trader report released on Monday afternoon showed the hedge funds were net buyers of 67,859 contracts, holding a net long position of 228,806 contracts. This is the hedge funds most bullish view of corn since Feb 2023.
• USDA announced a flash sale of corn this morning. Columbia stepped into the export market and purchased 110,000 MT (4.3 mb) of corn for the current marketing year, underscoring ongoing supportive demand for corn.
• The corn market remains vigilant about weather conditions in Argentina, where forecasts of dry, warmer weather in mid-January are supportive of prices. However, anticipated rainfall towards late January could influence corn and soybean prices.
• 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 ended the day lower but rebounded significantly off their early morning lows that saw March futures as much as 11 cents lower. After yesterday’s rally, increased chances for rain in Argentina have pressured the complex with soybean meal leading the way lower while soybean oil was higher.
• The soybean market’s attention remains squarely on weather conditions in Argentina and Southern Brazil through mid-January. Recent forecasts predicting below-normal precipitation and warmer temperatures have lent support to soybean prices. However, the market’s direction into February will hinge on the reliability of long-range forecasts which are currently suggesting rainfall will resume mid-month.
• Hedge funds have shaved their current net short positions in the soybean market over the past couple weeks. As of December 31, hedge funds were net short 42,447 contracts by reducing the short position by a net 25,436 contracts. The short covering has been triggered by the current weather forecasts for Argentina and Southern Brazil.
• Indonesia’s admission as a full member of the BRICS bloc, with Brazil currently presiding, has implications for soybeans. As the world’s leading producer of palm oil, Indonesia’s membership could influence global vegetable oil markets, including soybeans, due to potential shifts in trade and policy dynamics.

WHEAT HIGHLIGHTS:

• The wheat complex closed higher, with early strength coming from winter wheat crop condition updates, released by select states yesterday afternoon. The good to excellent rating for Kansas came in at 47% which is a sharp decline from the last rating of 55% in November. Conditions also declined in South Dakota, Oklahoma, and Nebraska.
• European Union 24/25 wheat exports have reached 11.16 mmt as of January 5. This is down 34% from a year ago, which along with a lower Russian crop, could be supportive to the U.S. wheat export market.
• According to data from the CFTC, funds have reduced their net short position in Chicago wheat by 8,247 contracts as of December 31, bringing their total net short to 86,762 contracts. In Kansas City, they reduced their net short position by 1,075 to 33,861 contracts.

DAIRY HIGHLIGHTS:

• Class III futures traded lower for much of the trading session before ending with mixed results at the close. The February, March, April and May contracts all traded into new contract highs today before pulling back.
• Spot cheese gave back some of yesterday’s gains dropping 1.875 cents to close at $1.88875/lb. Whey lost 0.75 cents to go home at $0.74/lb.
• Class IV futures were mostly higher on the day led by the June and July contracts, which both gained 15 cents to close at $20.70 and $20.65 respectively.
• Spot butter gained a penny to trade back at $2.58/lb, while powder lost half a cent to close at $1.3650/lb.
• Today’s Global Dairy Trade auction event was down 1.40% from the previous auction.

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Author

Amanda Brill