TFM Midday Update 4-1-2024

CORN

Corn is trading sharply lower to start the week wiping out a portion of the gains that followed Thursday’s USDA Stocks and Acreage report. Futures are bear spread with the front months posting larger losses than new crop corn.
Thursday’s USDA report said that US ag markets were expected to lose 6 million acres this year due to lower profitability, but with futures lower today, there may be some traders who expect some of those acres to be factored back in later this year. Corn stocks came in lower than expected which likely points to strong export sales recently.
Friday’s CFTC report as of March 26 showed funds coming into the report with a net short position of 251,730 contracts, but it was estimated that they bought back 10,500 of those contracts on Thursday.

Soybeans began the day trading higher with support from soybean oil and the rest of the veg oils but has slipped and is now trading lower on the day. Soybean meal is lower, and soybean oil has lost some of its earlier gains. Thursday’s report was within trade expectations, but the prospect of larger soybean planted acres is bearish.
In January, soybean oil for use in US biofuel production fell to 960 million pounds from 1,141 million pounds in December. Despite this, crush demand is strong and soybean crush is seen at 196.7 mb in February which would be up 11.2% from the previous year.
Friday’s CFTC report showed funds as buyers of soybeans as of March 26 by 13,559 contracts leaving them net short 134,780 contracts, but it is estimated that on Thursday following the USDA report, they sold 1,500 contracts.

All three wheat classes are trading lower this morning led by KC wheat. Chicago wheat has been in a slight uptrend over the past few weeks while KC wheat is at the lower end of its trading range and not far off the contract lows.
Thursday’s USDA report showed total wheat acres within trade expectations at 47.5 million acres, but that is down from 49.6 ma last year. Fewer winter wheat acres are expected to be planted while slightly more spring wheat acres are expected.
Friday’s CFTC report showed funds as sellers of both Chicago and KC wheat. They sold 11.532 contracts of Chicago wheat, increasing their net short position to 92,102 contracts. In KC wheat, they sold 4,781 contracts, increasing their short position to 42,638 contracts.

Amanda Brill