Tuesday, February 18, 2025
Closing Markets: Corn +5.75 old & +4.50 new.
Beans +2.50 old & +6 new. Wheat +4.75.
 
Market Recap:
 
 
 
Good afternoon. Technical buying in the corn and wheat markets led the CBOT to mostly higher closes on Tuesday, as the new week got off to a similar start to how last week ended. In the case of corn, prices were finally able to breach the $5 level, while in wheat, front month futures managed a close above the 200-day moving average for the first time since early October. Soybeans were a follower to start the week, as trade here remains largely rangebound.
 
CH ended Tuesday at 5.02, up 5 and 3/4. This the first close above $5 for spot corn since October of 2023. CK closed at 5.15 3/4, up 7 cents. SH was up 2 and 1/2 cents at 10.38 1/2. SK closed at 10.55 1/2, up 2 and 3/4. WH was up 4 and 3/4 at 6.04 3/4. New high for the move at 6.09. Products were mixed, March soybean meal closed at 293.80, down $2.10/ton, and March soybean oil closed at 47.30, up 1.23. Inside day for meal. Livestock markets finished the day mixed, April live cattle closed at 194.02, down 22 cents, March feeders were up $3.37 at 269.72, and April hogs closed at 93.20, up 60 cents. New low for the move in live cattle at 193.02. Outside markets are mixed, crude oil futures are up $1-$1.10/bbl, the Dow Jones index is up 20 points, and the US$ index is up 30-40 points. The S&P500 is up 10 points and the NASDAQ is up 20 points. Gold futures are up $55/oz and natural gas futures had an outside day higher and are up 25 cents.
 
Spreads were mixed/lower to start the week, corn spreads were down a penny and a half to up 2 and a half cents, and soybean spreads were down a quarter of a cent to down 3 and a half cents. CH/CK closed at -13 and 3/4 down a penny and 3/4, and SH/SK closed at -17, down 1/4 of a cent.
 
Soybean crush data from the National Oilseed Processors Association (NOPA) released earlier this morning was the main fundamental news in the marketplace to start the week, and showed bean crush in the month of January at 200.383 mil bu's; this was well below the average trade guess but still up nearly 8% from the same month last year and also the second highest monthly figure ever recorded. According to analysts, frigid temps at mid-month through the Midwest likely reduced plant efficiency, while several locations in the south mentioned logistics issues due to the historic snow event and icy roads causing a slowdown in operations. They also added that an excess buildup of soybean meal supplies was reason for a slower crush pace at some locations. NOPA additionally showed soybean oil stocks as of January 31st at 1.274 bil lbs, which was a 6-month high and up nearly 3% from December's reading; the figure, however, was down more than 15% from January of 2024, further illustrating the strong pace of both domestic use and exports.
 
Other demand data on Tuesday included export inspections for the week ending February 13th, which were delayed a day this week due to the Monday holiday. The numbers showed another strong week of corn loadings, with inspections of 1.611 mmt's being up nearly 20% from last week and also the highest level ever recorded for that particular week. Soybean inspections meanwhile were down 34% from the week prior at 720k mt's, and wheat inspections were down 56% on the week to 250k mt's. Strong pace early in the season is keeping soybean exports mostly in line with USDA expectations still, but should this slow pace of late continue, we would expect the talk of a trimming of the export forecast to grow louder as we get into spring.
 
Aside from this strong sales report, it was mostly the same ongoing themes from the past several weeks that presumably caused the buying on Tuesday in the feed grain markets, with there not being one specific reason that finally pushed prices above old resistance. In the case of wheat, the funds remain short and ongoing concerns over winterkill in the US and Russia are likely leading to further position covering despite progress seemingly continuing to be made on talks to end the war in Ukraine - a situation which we are still having a hard time seeing as anything but bearish. Corn on the other hand saw technical buying above $5 from a chart standpoint, while there is ongoing concern over safrinha production prospects in Brazil that will likely keep the funds from covering their longs until a better understanding is had on the size of this crop in April and May. The global balance sheet is just too tight to afford any significant hiccups in production from any of the world's major producers, which will likely act to keep some sort of floor under the market into US summer.
 
Speaking of the weather situation in South America, forecasts at mid-day on Tuesday were again largely unchanged from the overnight runs, and continue to offer a band of fairly heavy precipitation to an area from northern Argentina through southeast Paraguay and into southern Brazil over the rest of this week and into next week. Otherwise, a small pocket south of Buenos Aires sees shower potential the rest of this week, but the rest of Argentina will be mostly dry. Similarly for Brazil, most of the central part of the country looks to stay largely dry for the next 5 days. Temperature anomaly forecasts for the next week show heat will continue to be an issue for most of both the countries, with the warmest temps in relation to average seen in central Argentina.
Temperatures will be the forecast focus in the US over the next week, as areas in the central part of the country will be the coldest on the face of the Earth in relation to average levels. Highs as far south as central Texas will be some 30+ degrees F below average through the end of the week, before a warming pattern then emerges into next week; in parts of the Dakota's and other northern states, there will be a roughly 80 (eighty - no, not a typo) degree swing in temps from today's lows to the highs next Monday. On the precip side, models are in fair agreement on additional moisture for both the southeast and the northwest through tonight and tomorrow, before a few days of drier weather are then likely for both areas going into the weekend and the first part of next week. There is not a lot of agreement then beyond the next week, with week two forecasts showing a return to wetter conditions through the central US in the case of the EU AI model, while the GFS ensemble is dry in the central US but wet up the East Coast and into the northeast, and EU ensemble is dry in the east and the west, but sees average moisture through the central US. The extended forecast will need monitored as we go through this week.
 

 
Enjoy the night!
 
 
Bailey Runyen
Grain Originator  |  Topflight Grain Coop.
101 N. Main St.  |  Cisco, IL 61830
Phone :: 217-669-2141
Email ::  brunyen@tfgrain.com
 
 
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