TFM Morning Update 03-07-2024

CORN

Corn is trading higher this morning with the front months leading the deferreds as the market advances above its recent consolidation range and is trading above the 20-day moving average for the first time this year.
Yesterday’s weekly EIA report on ethanol production showed average daily production for the week ending March 1 at 1.057 million barrels, and corn used during the week was 104.91 million bushels, which was above the pace needed to reach the USDA’s target. Ethanol stocks did come in at a record 26.051 million barrels.
Weekly corn export sales figures for the week ending Feb. 29th will be released later this morning with current estimates running between 45 and 78.4 mb for the 23/24 marketing year.
China continues to buy cheaper Ukrainian corn due to its discount on the world market. US FOB prices are currently running about $192/mt versus Ukraine’s $169.
Managed funds were seen covering some short positions yesterday, buying an estimated 1,000 contracts. They currently hold a net short position estimated at 349,000 contracts.

The soybean complex is higher across the board with all three commodities trading near the upper end of their recent consolidation ranges, as they regain yesterday’s losses.
The Chinese Dalian markets were all higher for beans, meal, oil and palm oil, lending some support to the US markets. Although, Malaysian palm oil was slightly lower.
Export prices in Brazil reported jumped yesterday to $428/mt. Though this is still cheaper than US offers at a comparable $447/mt, the jump likely is adding support to this morning’s prices.
Weekly soybean export sales figures for the week ending Feb. 29th will be released later this morning with current estimates running between 10.5 and 36 mb for the 23/24 marketing year.
Managed funds were relatively quiet in yesterday’s trade. Their activity in the soybean pit was estimated to be about even between buying and selling, while they bought an estimated 2,000 meal contracts and 1,500 soybean oil contracts. They are currently estimated to be net short about 154,000 soybean contracts, 40,000 meal, and 58,000 soybean oil.

The wheat complex is currently higher across all three classes with KC and Minneapolis showing the largest gains.
Rumors that China may be looking to cancel open US purchases due to the recent price drop, weighed heavily on the markets yesterday in which both Chicago and KC printed fresh contract lows.
It’s also rumored that Russia’s export prices may have dropped even further to where they may be below $190/mt. This may keep a lid on prices when compared to current US offers near $232/mt.
Later this morning weekly wheat export sales figures for the week ending Feb. 29th will be released. Current trade estimates are for 23/24 sale to come in between 15 and 33 mb.
Managed funds were quite active in the wheat market yesterday, selling an estimated 7,000 contracts of Chicago wheat. This activity now brings their estimated net short position to 85,000 contracts.

Scott Masters