CORN HIGHLIGHTS:

• The corn market faded from early session strength to finish mixed on the session. December corn futures expired during the session and settled on final trades at $4.56 ¾. March corn was ¼ cent lower on the day in a market that saw noticeable bear spreading.
• As December expires, March is currently holding a 23 ¾ cent carry to the final December price. This could keep pressure on the March contract as demand concerns and a large current supply of corn will limit the front end of the corn market.
• The USDA reported weekly export sales for corn at 1.418 MMT (55.8 mb) for last week. Corn sales commitments now total 1.069 bb in 2023-24 and are up 36% from a year ago. Pace is ahead of current USDA projections, but the market will need to see consistent export sales totals.
• Ethanol margins should see some price support with a boost in energy prices on the session. Both crude oil and gasoline prices treaded firmly higher on the session, and that helped support the corn market.
• South American weather will stay a focus to the market. The next 7 days show a more moderate precipitation, but above average temperature forecast. Longer extended forecasts are more favorable for crop growth, but those forecasts will need to materialize. The South America weather concerns will likely be a longer-term corn story as Brazil looks towards soybean harvest and corn planting in the weeks ahead.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day higher after two consecutively lower closes and remained above the 200-day moving average. Today’s support was largely due to a sharp decline in the US dollar as well as a strong weekly Export Sales report and a daily flash sale reported.
• For the week ending December 7, the USDA reported an increase of 39.8 mb of soybean export sales for the 23/24 marketing year. While strong, this was 23% below the previous week and 46% from the prior 4-week average. Export shipments were above the 27.7 mb needed each week at 42.6 mb and primary destinations were to China, Germany, and Mexico.
• This morning, private exporters reported a large flash sale of 400,000 mt of soybeans for delivery to unknown destinations for the 23/24 marketing year. US soybeans are competitive with Brazilian offers, but that export window will likely close soon as the bulk of South America’s bean harvest approaches in a few months.
• While Brazilian weather is expected to remain hot and dry over the next 5 days, the longer-term weather forecast is better, and most analysts are projecting total production between 155 and 160 mmt. Argentinian production is estimated around 48 mmt.

WHEAT HIGHLIGHTS:

• All three US wheat classes closed with modest gains today, rebuffing the weakness yesterday. The 100-day moving average for March Chicago wheat is at 6.24, and with that contract trading below that level, it might now act as an area of resistance. Going forward, more friendly news may be needed to push back above that moving average.
• The USDA reported an increase of 54.8 mb of wheat export sales for 23/24 and an increase of 0.7 mb for 24/25. This is reflective of the recent Chinese purchases. On the negative side, with the USDA estimating exports of 725 mb, last week’s shipments at 10.6 mb were below the 16.4 mb pace per week needed to meet their goal.
• Following the Federal Reserve’s announcement yesterday afternoon, the US Dollar Index was under pressure again today with another sharp drop. As of this writing, it is just below the 102 level, when it was over 104 just a few short sessions ago. This decline should provide some support to the export market and may have given wheat futures a boost today.
• According to the Rosario Grain Exchange, Argentina’s wheat harvest is reported to be 57% complete. Additionally, their wheat crop estimate is now 7.4% higher at 14.5 mmt vs 13.5 mmt previously. The reason, as stated by the exchange, is due to cooler temperatures and better rains that helped the plants when they were filling.
• In contrast to Argentina, the Brazilian 23/24 wheat crop is now seen lower on estimates by StoneX, at 8.59 mmt, vs 9.28 mmt previously. Furthermore, the yield is expected to drop 28.4% from the previous harvest. This may also result in Brazil wheat imports increasing down the road.

DAIRY HIGHLIGHTS:

• Spot cheese dropped 2.6250 cents to close at $1.5325/lb on 7 loads traded. Blocks are sitting at a 7.50-cent premium to barrels.
• This had Class III futures lower once again with the second month January contract lower to $16.24. It has been lower for 7 of the last 8 trading days.
• Class IV futures saw some minor positive closes for the Q1 contracts with the January contract at $18.59.
• This was impressive despite another 4-cent drop in spot butter to $2.46/lb. Powder was a penny higher at $1.1725/lb.
• The House of Representatives passed the Whole Milk for Healthy Kids Act, which will permit whole milk back in schools for the first time since 2012 if it passes the Senate vote.

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Author

Amanda Brill