TFM Midday Update 11-01-2023

CORN

Corn is trading lower near midday and has dropped below the bottom range of the recent trading range. March corn is currently just 5 cents above its contract low.
US ethanol output last week rose to an 11-week high, reaching normal to above normal levels for the date. Ethanol stocks at 21M barrels last week is the lowest for any week since December 2021.
In South America, rain chances are improved for northern Brazil and Argentina, but Mato Grosso, a key soybean growing area in central Brazil, has remained very dry.
US corn offers out of the Gulf are now at parity with Brazil, but demand has been sluggish anyway with little activity from China and the bulk of exports to Mexico.

Soybeans are trading higher today with support from soybean oil, but soybean prices remain rangebound and will likely need more bullish news to break out of the range.
Crude oil is trading higher as the fighting between Israel and Hamas escalates. Israel is in the middle of a ground invasion in Gaza, and US bases in Syria and Iraq have reportedly been the target of drone attacks.
NOPA crush numbers will be released later today with the average trade estimate at 175 mb. This would be above the 169 mb crushed in August and also above the 167.6 mb a year ago.
ANEC has reported that Brazilian soy shipments in October are likely to be near 6 mmt which compares to 3.6 mmt just a year ago as they primarily ship to China.

Wheat is mostly higher with the front months gaining on the deferreds in all three classes. Minneapolis wheat has sold off significantly and is only a few cents off its contract lows.
Russia continues to dominate global exports offering wheat at a cheap $230 per metric ton. US hard red winter wheat export sales are over 35% lower than a year ago.
There have been early reports that China has purchased 2 mmt of wheat from Australia and 2.5 mmt of French wheat after 20% of China’s wheat crop was reportedly damaged by flooding.
Argentina recently got some relief with showers in key areas, but the US attaché there is projecting that Argentinian wheat production could slip to 14.5 mmt.

Amanda Brill