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Grain Comments: 02.21.24

Good morning. Ag markets are retracing some of yesterday’s gains so far in the overnight session. One-tick chart gaps have been filled on the soybean charts, while corn and wheat get dragged lower. Corn futures are down 2-3 cents, soybean futures are down 6-9 cents, and the Chicago wheat market is down 2-4 cents. Products are mixed, soybean meal is down $4-5/ton, while soybean oil is up 5-10 points. Outside markets are also mostly lower, crude oil futures are down 10 cents/bbl, the Dow Jones index is down 60 points, and the US$ index is up 5 points.

 

Today’s Reports: FOMC Minutes; API Energy Stocks

 

  • Fresh ag specific news is mostly lacking this morning, as the overnight trade has been technical in nature. Volume shows traders are beginning to move positions to the May, as March approaches first notice day.

 

  • Brazilian agribusiness consultancy Agroconsult said yesterday they were lowering their estimate of the Brazilian soybean crop to 152.2 mmt’s, which would be down 1.6 mmt’s from their previous estimate.

 

  • The group also said their estimate was the result of 33 days of touring fields, and estimated they had covered some 30,000 kilometers. This was around 60% of the total area they anticipate surveying.

 

  • Brazil soybean export price is currently quoted around $411/ton, compared with US offers near $463, which likely limits US export potential.

 

  • For corn, Brazil export price is quoted at $183/ton, Ukraine is $167 and the US is near $190.

 

  • Ukraine’s Ag Ministry announced yesterday 3.66 mmt’s of ag products had crossed Ukraine’s borders in the first half of February. This includes 1.52 mmt’s of corn, and 1.09 mmt’s of wheat.

 

  • Total monthly grain exports compare to 6.36 mmt’s in January of this year, and 6.33 mmt’s in Feb of 2023.

 

  • ANEC announced Brazil soy exports were seen reaching 7.3 mmt’s in February, compared to 7.55 mmt’s in Feb of 2023. Meal exports were seen reaching 1.86 mmt’s, which compares to 1.28 mmt’s last year.

 

  • Same group estimated corn exports for February at 716,718 mt’s, vs 1.94 mmt’s in Feb of 2023. Wheat exports are seen at 715,863, vs 522,988 last year.

 

  • Russia’s Ag ministry announced late Tuesday it expects the nation to export up to 70 mmt’s of grain in 2024. This was an increase of 4 mmt’s from his previous estimate.

 

  • In the Middle East, an Israeli airstrike hit a residential building in the Syrian capital of Damascus overnight, killing two people and wounding a number of others.

 

  • The US continues to reject UN-brokered ceasefire deals, citing an agreement to the hostage situation had not been reached, and that they would not jeopardize further negotiations by hastily signing and agreeing to something.

 

  • Financial markets today will be keyed by two events; the first will be AI tech stock Nvidia’s quarterly earnings report, due out this morning.

 

  • The second will be the release of the FOMC January meeting minutes, which are due out at 1pm central time Wednesday. Traders will look for clues regarding potential rate cuts in the March meeting.

 

  • Weather forecasts continue to feature dryness for Argentina into Southern Brazil for the next week to 10 days. In the 11-15 day period, the EU model is drier than the GFS, which is forecasting .25-1.5″.

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