Closing Markets: Corn: -4.75 old & -3.25 new.
Beans: +3 old & -4.50 new. Wheat: -5.50.
All TFG locations will be closed Monday, February 16th for President’s Day!
Good evening!
Market Recap-
Happy Friday. Ag futures ended the week mixed to mostly lower at the Board of Trade this week, as a morning rally in the soy complex failed and rolled over into the afternoon hours after scoring new highs for the week early in the day on rumors of Chinese buying. Like we mentioned this morning though, it wound up being a classic buy the rumor, sell the fact situation as the day went on, and prices ended up finishing some 20+ cents off the highs. Corn and wheat futures were also well off their highs for the week by today's close, which sets clear upside resistance going into next week.
Corn Summary-
Corn futures briefly traded into the green this morning before rolling over and working lower throughout the morning and into the close, ending what had been a three day winning streak this week. We mentioned spill over buying from the bean rally into the grain markets previously as being part of the reason for the rally there this week on the Trump comments, but would also note that the rally in beans helps corn from an acreage standpoint also. New crop bean futures at or above $11 would likely spur additional acreage, which in turn could be friendly corn. Otherwise, it was a slow news week here for the market specifically, with much of the price action the last several days the result of potentially changing fundamentals elsewhere.
Soybean Summary-
Soybean futures were mixed to end the week, with the front months higher and the back months lower on what ended up being a reversal day on Friday. The push to new highs this morning on the rumored China sales was likely algorithm driven, with profit taking then emerging from spec traders as prices shot out to new highs ahead of the weekend. The bottom line is that even if China ends up buying another 8 MMTs, there's a chance that if business elsewhere around the world slows down that it still might make the USDA's current export forecast nothing more than accurate. Shifting several cargoes of demand from one country sitting on a ton of beans to another does little to impact the fact that the world has plenty of beans to satisfy everyone's demand at the moment. From a price standpoint, any business that isn't politically tied to the US should be shifting to the southern hemisphere in the next couple weeks to a month.
Wheat Summary-
Wheat futures were in lock step with corn market on Friday, and ended the week lower after also trading back to Monday's highs early this morning. The Canadian wheat stocks data could be pointed to as a fundamental reason for the day's selling, but in our opinion, the numbers do little more than further illustrate what continues to be an excessively loose global supply situation that the market has been well aware of. On the export front, Russian prices at around the $230/ton level keep US supplies out of most markets, which we would think continues to limit price rallies on the margin.
Outside News Headlines-
Crude oil futures up $0.10+/bbl.
Weather Updates-
Weekend weather across the Midwest will feature some light snow chances through the eastern part of the region and then up into the northeast, but otherwise will be clam elsewhere with increasingly warm temps likely. The warmest air looks to linger in the region through Tuesday, but the ridging across the eastern and central US will keep things on the warmer side of normal still at least into the end of the week next week.
Beyond the middle of next week, models have tried to bring wetter conditions into the Midwest and southeast this week, but in the last 24 hours or so have become a little more disorganized on these systems, which has lowered our confidence a bit. Anomaly maps are still wet through the region, but it will be notable to watch how the pattern progress through the weekend. Amid soil moisture deficits through a lot of the heart of the central Corn Belt, an uptick in moisture into March would be welcome.
Models are in good agreement on a couple days of drier weather now for Argentina following recent rains this week before moisture likely returns Sunday/Monday. There are then several rain chances the next 10 days for the area, which should help to continue to stabilize soil moisture levels. Temperatures into the first part of next week are expected to be average to below average throughout most of the country.
Things are little changed again for Brazil this afternoon in the short term, but are beginning to show signs of shifting over the next 10-15 days to a drier pattern throughout the heart of the country, which should lead to a rapid increase in harvest progress. The moisture is seen shifting south into some of the far southern parts of the country and northern parts of Argentina, which have been dry for the better part of the last 4 weeks now.
Enjoy it!
Bailey Runyen
Grain Originator | Topflight Grain Coop.
101 N. Main St. | Cisco, IL 61830
Phone :: 217-669-2141
Email :: brunyen@tfgrain.com
