Corn is trading slightly lower to begin the week and remains rangebound as good export demand supports the market while large supplies add pressure.
Brazil is now reportedly 80% complete in planting its first crop corn and Argentina is 26% complete. Brazil received light rains over the weekend but not as much as was needed.
Friday’s report from the USDA showed that export sales and shipments of corn are now up 27% so far this year with Mexico being a main buyer, but China stepping in as well.
Strong ethanol margins have been a boon for domestic demand with ethanol production up nearly 6% from a year ago at this time.
Soybeans are trading higher this morning after a selloff on Friday that was largely due to light holiday trade volume. Both soybean meal and oil are higher.
Trade remains extremely focused on Brazilian weather, and although some rains have fallen in central Brazil over the weekend, totals are below the average amounts.
While central and northern Brazil are too dry, behind on planting, and may have to replant, southern Brazil is far too wet and is only 25% planted which is down from 55% last year.
Despite holiday volatility last week, soybean crush premium based on January futures remains very profitable and is a large source of soybean demand.
Wheat is trading slightly higher this morning with KC attempting to move higher off of Friday’s new contract low, but the overall trend has been lower for a long time now.
French wheat prices have been slipping along with prices in the U.S. as other global producers struggle to compete with cheap Russian exports.
Last week, Russia proposed a tariff quota for all grains that would limit sales to 24 mmt from Feb 15 to June 30. This would be supportive for U.S. exports.
After more Russian attacks over the weekend, Ukraine is now planning to place convoy vessels in the Black Sea to protect their export corridor.
Grain Market Insider is provided by Stewart-Peterson Inc., a publishing company.
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