Closing Markets: Corn: -0.25 old & -0.50 new.
Beans: +1.25 old & -1.25 new. Wheat: -0.75.
Good evening!
Market Recap-
Traders in the ag space saw a ho-hum Friday to end the week this week with the whole of the space closing within spitting distance of unchanged on little new news and as anticipation builds for Monday's final update on 2025 US corn and soybean crops. The corn yield number is the big one, but bean production will also be looked at and there's a chance even if production is lowered, demand could be trimmed along with it to offset some of the net effect. However, all that said, once the dust settles on the report, focus will quickly shift back to the southern hemisphere, where regardless of what the USDA says on US yields, there is still a massive crop that is about to be harvested.
Corn Summary-
Not a lot to talk about in the corn market to end the week on Friday, as prices closed moderately lower on little to no news and as traders are firmly entrenched in waiting to see what Monday's update is going to show. All the production numbers are one thing, but if the USDA decides to subsequently drop demand and keep ending stocks north of 2 bil bu, we don't know that the production cuts will still be able to sustain any sort of long-term rally. If a cut in production occurs that's fine, but we remain in the camp that it's simply going to be tough to get demand to be a whole lot better than it is today.
Soybean Summary-
While the report on Monday is not expected to have quite as outsized an impact on futures prices as in the corn market, it still seemed as though traders were in wait and see mode to end the week on Friday as markets closed just slightly higher on what was an overall quiet end to the week. Possibly more important than what the USDA does with the US numbers on Monday will be what they decide to do with their Brazilian number, as some local privates are now tossing around figures in the mid-180s, some 10 MMTs higher than where the USDA currently stands. For comparison, 10 MMTs would be roughly the state of MN's entire production each year. Like we said for corn, a drop in production is fine but if it’s accompanied by a higher revision in Brazil, it does little to change the fact that the world has plenty of beans to go around.
Wheat Summary-
Wheat futures traded lock step with corn to end the week on Friday, as values saw narrow ranges and not a lot of excitement past about 9:30am central time this morning. For wheat, the key for Monday will be whether any production adjustments are made via acres or yield, as it seems the dry winter in the southern and south-central plains to this point has had at least a minor adverse impact on the crop. Otherwise, continuing to simmer on the back burner is the war in Ukraine and weather in the Black Sea region, which have both been non-impactful to the market the last couple days.
Outside News Headlines-
Crude oil futures up $1.10+/bbl.
Weather Updates-
Models have continued to trend drier for the second system that's expected to impact the Midwest through the coming weekend, with additional rains expected to continue through the southeast but just light/scattered precip for the central part of the area through the morning tomorrow. The system is still expected to bring cooler air with it, but it won't last beyond the first part of next week and temps are expected to return to above average by Tuesday.
Two week forecasts this afternoon are like previous runs this week and continue to show mostly drier biases aside from the Great Lakes area, with the most unlikely places to receive rainfall between now and January 22nd being the southeast and the West Coast. Temperatures will continue to see a fairly pronounced divide, with the eastern and northeastern parts of the country generally staying cooler than average while the west and southwest stays warm.
Little change to the forecast for South America this afternoon, with models remaining in fair agreement on continued rainfall across the area of northern Argentina/Paraguay/Uruguay/southern Brazil, while the rest of the growing areas to the north and south see mostly dry weather into the first part of next week.
The forecast for northern and central Brazil then into the middle of next week has trended drier the last day or so, but amid no heat and good soil moisture this trend should do nothing but allow for harvest to get rolling sooner. Models are also slightly wetter in Argentina into the back half of next week, which is a good development.
Enjoy it!
Bailey Runyen
Grain Originator | Topflight Grain Coop.
101 N. Main St. | Cisco, IL 61830
Phone :: 217-669-2141
Email :: brunyen@tfgrain.com
