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Grain Comments: 02/09/2023

Good morning!

Soybeans refuse to stray too far from recent highs with rains continuing to disappoint in Argentina; the USDA has slashed ARG crop estimates each of the last two months but is presumably not low enough just yet.

Rains and mixed precipitation remain in the central/eastern Midwest this morning after heavy rains south over the past 24 hours; extended maps are still active precipitation-wise with temps staying mostly warm, particularly center-east. 

Argentine rains were very isolated northeast yesterday, picking up a bit center -north later this weekend into early next week, but the hot & dry pattern holds overall. Brazil saw rains far north and south over the past 24 hours but cover-age looks good throughout crop areas through Monday and again for the 6-10. 

The lack of a surprise in the February WASDE report greatly limited its impact on futures. It was not surprising that most attention fell on the Argentine crops, but even then, alterations were in line with trade guesses. Now that we are past the monthly WASDE report we will see a change in market focus. South American weather and harvest updates will still be a key factor in daily price discovery. Not only will trade be monitoring yield reports to see if the record volumes in Brazil’s soybean crop continue, but how their developing Safrinha crop is progressing. Recent rains have delayed Safrinha planting, but this does not mean a smaller crop. In fact, the adequate soil moisture could end up being quite beneficial. We will also start to see more attention placed on US weather outlooks as we approach the spring planting season. Several forecasters are predicting normal growing conditions across the US this year as the La Nina event comes to an end. The most concern remains on the Plains where drought continues. Trade will also show more interest in the Ag Outlook Forum that takes place at the end of the month as it gives us a better indication of new crop demand predictions. 

Have a great day!

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