Corn is trading lower this morning and has gapped lower for a second consecutive day after March futures fell short of the 5-dollar mark last week, and the Trump tariffs went into effect over the weekend.
President Trump has put tariffs of 25% on both Canada and Mexico who had previously not had any tariffs on them, and tariffs on China were increased another 10%. The dollar has rallied on this news and it has been bearish for grains but bullish for energies. Trudeau has said Canada would retaliate by placing 25% tariffs on US goods.
Friday’s CFTC report saw funds as buyers of corn as of January 28 by 39,043 contracts which increased their net long position to 350,721 contracts.
Soybean futures are trading lower to start the day alongside corn and wheat as a response to the tariffs, but it has been interesting that soybean meal is driving the complex lower while soybean oil is benefitting from the tariff news and trading higher.
Brazil’s 24/25 soybean harvest is reportedly 7.6% complete as of January 31 which compares to a pace of 15.7% the previous year and the 5-year average of 11.8% at this time.
Friday’s CFTC report saw funds as buyers of soybeans as of January 28 by 16,166 contracts increasing their net long position to 56,496 contracts.
All three wheat classes are trading lower this morning but have not has as significant of a bearish reaction to the tariff news as corn and soybeans have as wheat is already near contract lows.
SovEcon has cut its estimate of Russian wheat export outlook as a result of limited supplies and low profitability for shipments abroad. Their export outlook is now at 42.8 mmt which is 2% lower than the previous estimate.
Friday’s CFTC report saw funds as sellers of Chicago wheat by 18,990 contracts leaving them short 110,782 contracts. They were sellers of KC wheat by 7,255 contracts which left them net short 42,386 contracts.
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