TFM Midday Update 02-19-2025

CORN

Corn prices trade higher at midday, supported by increased demand for U.S. corn and a new wave of buying driven by inflation concerns.
Recent rains and cooler temperatures have provided much-needed relief to drought-stressed corn crops in Argentina, with additional rainfall expected over the next 15 days in key growing regions.
Safrinha corn planting remains behind schedule but is expected to accelerate as ongoing dry weather facilitates progress in the soybean harvest.
The Thai feed mill industry is exploring the import of $2.8 billion worth of U.S. agricultural commodities, including a significant amount of corn, in an effort to bypass tariffs.

Soybeans trade higher at midday, along with corn. While soybean and soybean meal prices are gaining, soybean oil is trending lower. Traders worry if prices will hold up to growing harvest pressure in Brazil.
Continued dry weather in Brazil is helping advance the soybean harvest, although it remains behind schedule. Meanwhile, rains in southern Brazil and Argentina are slowing the crop decline, though heat and drought stress have already inflicted some irreversible damage.
A large Brazilian harvest is expected to slow U.S. soybean exports to China, with 72% of Brazil’s bean crop destined for the country, compared to 53% of the U.S. crop. U.S. exports are likely to decline this spring as China is expected to favor South American beans due to tariffs.
The Rosario Grain Exchange states the core Argentine crop region production is expected to be down to 16.5 mt vs the early season estimates of 19.5.

Wheat prices trade lower at midday, pressured by a stronger U.S. dollar and uncertainties surrounding weather conditions in major wheat-producing regions.
Well-below-normal temperatures in the U.S. Plains are expected to persist through Friday, with little to no snow in the forecast. Overnight temperatures are anticipated to drop to the -20s to -30s, raising concerns among traders about whether the current snow cover is sufficient to protect crops from potential winterkill damage.
Wheat markets continue to receive support from a recent uptick in import demand, along with persistent cold weather in both the Black Sea region and the U.S. Temperatures in Russia remain low, with little to no snow cover.
Reuters reported that Russian exporters will be able to deliver no more than 8.1 mmt of wheat by the end of the 2024/25 season, significantly below their permitted quota. The Russian government is allowing traders to export as much wheat as possible during the first half of the season, from July to February, but impose export restrictions through quotas in the second half.

Lauren VandenLangenberg