TFM Morning Update 12-27-2023

CORN

Corn is currently trading slightly lower in a tight 1 3/4 cent range after Tuesday’s solid reopen to the shortened holiday week.
Yesterday’s weekly export inspections report showed 1.082 mmt (42.6 mb) of corn inspected for export. Currently, total inspections are 26% ahead of last year at this time and on track to hit the USDA’s forecast.
South American weather continues to show improvement. Much needed rain is expected to favor the parched areas of northeastern Brazil. Argentina continues to see favorable weather, with current expectations for their corn crop weighing on US prices.
Managed funds were active buyers in yesterday’s trade, buying an estimated 4,000 contracts of corn. They are currently estimated to hold a short position totaling 156,000 contracts.

The soybean complex is trading lower this morning in a quiet 7-cent range. Both soybean meal and oil are also trading lower this morning.
Forecasts continue to show rain for the dry areas of Brazil which should help to stabilize crop conditions. The much-improved conditions in Argentina from last year continues to weigh on soybean meal, which has steadily come off its high from mid-November.
With the last large soybean sale to China reported on December 19, concerns are growing that they may have filled their needs for now and be done buying US beans.
Managed funds were active buyers in the soybean market yesterday, buying an estimated 6,000 contracts. This would bring their current long position to an estimated 29,000 contracts.

All three wheat classes are trading lower this morning in quiet trade. While most of Chicago and KC contracts have seen activity, only March and May Minneapolis have traded this morning.
Yesterday, the wheat complex posted strong gains as tensions in the Black Sea region escalated once again with an attack by Ukraine on a Russian warship in a Crimean port. Lately, Ukraine war news has been mostly brushed off by the markets in general, but with the end of the year approaching, this event likely triggered short covering.
In general, world wheat demand has been increasing lately, but since Russia continues to be the cheapest origin, they have been the dominant source.
Yesterday, managed funds were active buyers of Chicago wheat, buying an estimated 10,000 contracts. They currently hold an estimated short position totaling 58,000 contracts.

Scott Masters