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Grain Comments: 02-02-2024

Good morning.

CBOT futures are mixed/lower so far in overnight trade to finish out the week. Light volume and small ranges have been seen in corn, soybean, and wheat futures. Position squaring ahead of the weekend will likely be the theme today, as traders wait to see if the coming Argentine rains are pulled forward in next week’s forecasts. Corn futures are mixed/unchanged, soybean futures are up 3-4 cents, and the Chicago wheat market is up 5-6 cents. Products are mixed, soybean meal is up $2-3/ton, while soybean oil is down 10-15 points. Outside markets are also quiet, crude oil futures are up 30-40 cents, the Dow Jones index is up 30 points, and the US$ index is down 10 points.

Argentina weekly crop progress update showed a further decline in soybean g/ex readings. G/ex was seen at 36% this week, down another 8% from last week.

The fair category was mostly unchanged, up 2% from last week to 50%. Poor/very poor increased 6% from last week, registering at 14% in the most recent update.

Argentina corn crop conditions were seen 89% good/excellent, down from 95% last week.

Argentine grain exports for the month of December were valued at $1.25 Billion USD, which would be up a massive 64% from the previous year. This is also up nearly 25% from November.

Yesterday’s US census monthly crush report showed soybeans crushed in December at 6.129 mmt’s. This was 2.1% more than what was crushed in November, and 9% more than Dec 2023.

Stocks of soybean meal were seen 8.8% higher than last year, while soybean oil stocks were seen 28.7% less than a year ago.

US renewable diesel production hit 223.5 million gallons in November, up 80.8 million gallons from Nov 2022, and a record total for the month.

Total biofuel production, which includes biodiesel, hit a 7-month low of 384 mil gallons, but was still 26% more than Nov 2022. Soybean oil used in this production totaled 1.162 billion pounds, up 13% from 2022 and a record for the month.

Two of France’s main farmer unions urged protesters to return to their homes yesterday, as the government announced measures to try and appease some of their requests.

The UN Food and Agriculture Organization’s world food price index fell to a three-year low in January, driven by declines in cereals and meats.

Financial markets wrap up the week with today’s nonfarm payrolls report, as well as the monthly unemployment rate for January. Economists see the unemployment rate rising 0.1% to 3.8% in a Bloomberg survey.

South American weather forecasts remain the same. Brazil sees showers that could reach as far south as Parana by the weekend.

Argentina remains hot and dry for another 6-8 days, but models continue to be in good agreement on moisture of up to an inch arriving by February 9th/10th.

Have a great weekend.

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