Grain Comments: 02/14/2023

Before long we will start to see talks commence on the extension of the current Black Sea export corridor that expires on March 19th. The uncertainty if this being extended has caused a slight hesitation from importers to book corn and wheat needs from Ukraine in recent weeks. The fact that Ukraine’s offers are well under the rest of the global market, including the US, has limited how many buyers have walked away, however. The concern is that given recent escalation in fighting and ongoing sanctions Russia may not want to allow the corridor to remain open, but that would impact Russian exports as well, and seems unlikely. Still, the threat may bring the US more export interest in the next few weeks. For today’s session trade will likely show much interest in the release of the Consumer Price Index report. This is the gauge that is used to measure US inflation and has been improving for the past several months. Hopes are we will see another decline in the CPI and the Fed may suspend interest rate hikes, even if just temporarily. The Fed’s goal is to see inflation recede to 2% though and may keep raising rates until this is achieved.

Highlights
* Privates estimating larger 2023 US crops
* 2023 ending stocks also to rise
* El Nino odds increasing
* More countries buying Brazil corn
* So Korea has booked 2 corn vessels
* Low supplies may extend India wheat export ban
* 58% of US Winter Wheat in drought
* Winter Wheat drought area was 74% in November
* Ukraine restoring power grid
* Buyers shop for alternatives to Russian energy

Corn
* EU 23/24 production est 63.4 mmt
* EU production +9.2 mmt from 22/23
* US corn sales 55% of yearly forecast
* US/Mexico GMO deadline is today
* Privates have US carryout at 1.34 bbu

Soybeans
* US sales 88% of USDA forecast
* US sales may be underestimated
* US new crop sales -80% from last year
* Scouts continue to trim Argentine crop
* Privates est US carryout at 240 mbu