TFM Morning Update 01-16-2024

CORN

Corn is trading lower this morning on momentum from Friday’s WASDE report that saw higher production in the US for 23/24 as yields were increased to 177.3 bpa, up significantly from the previous week.
South American corn production was not lowered as much as trade had expected despite dry conditions with Brazil pegged at 127 mmt down from 129 mmt last month, and Argentina unchanged at 55 mmt.
Corn prices in Brazil have declined over the past week due to the beginning of the first crop corn harvest and an overall decrease in demand.
For the week ending Tuesday, January 9, non-commercials sold another 33,397 contracts of corn increasing their net short position to 230,723 contracts.

Soybeans are trading higher this morning and although they had a negative reaction to the WASDE report, they settled significantly off of Friday’s lows.
The USDA increased soybean ending stocks and overall production, but supportive was that the US stocks to use ratio is only 6.7%, and CONAB has released Brazilian production numbers that are closer to 150 mmt and are likely more accurate.
December soybean crush was seen at a record 192.6 mb which was up 8.5% from this time last year and up 1.9% from last month.
Friday’s CFTC report showed funds as sellers of soybeans by 19,619 contracts increasing their net short position to 31,248 contracts.

All three wheat classes are trading slightly higher this morning after last week’s USDA report which was mostly bearish apart from the wheat seedings number.
Wheat seedings were expected to decline by around 800,000 acres but the report revealed a decline of 1.4 million acres. World wheat ending stocks also fell slightly which was supportive.
Ships carrying over 1.3 mmt of grains have been diverted from the Red Sea to other routes due to attacks against Houthi rebels, adding to world shipping issues.
Friday’s CFTC report showed funds as buyers of wheat by 2,289 contracts decreasing their net short position to 57,988 contracts.

Amanda Brill