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Grain Comments: 02-22-2024

Good morning.

The CBOT is taking a breather so far in the overnight session, following yesterday’s lashing. Corn futures have again made new contract lows in both the old and the new crop, as it looks like the old crop market is poised to make a run at $4. Soybeans continue to hover just above contract lows, and a test of this level also looks likely. Corn futures are unchanged, soybean futures are 3-4 cents higher, and the Chicago wheat market is up 4-5. Products are mostly higher, soybean meal is up 50 cents to a dollar, while soybean oil is up roughly 10 points. Outside markets are mixed, crude oil futures are 10-20 cents lower, the Dow Jones Index is up 140 points, and the US$ index is down 30 points.

Markets are mostly quiet in light volume to begin Thursday. Following yesterday’s decline, traders are again wondering if the funds have scored new record short positions in corn and soybeans.

It would seem increasingly likely that Tuesday’s pop was nothing more than a profit-taking rally amid a bear market. The US producer had hoped this would be a turning point, as he/she has a significant amount of old crop left to market.

Late yesterday, the Rosario Grain Exchange lowered its estimate of the Argentine corn and soybean crops. The group now sees the soybean crop at 49.5 mmt’s, down from 52 mmt’s in their last forecast.

Same group lowered Argentine corn production from 59 mmt’s to 57 mmt’s. The group cited the negative impact from recent heat as the reason for the cuts.

Refinitiv Commodities Research Group slightly lowered their estimate of the Brazil soybean crop Wednesday, dropping it less than 1%. The new estimate of 149.6 mmt’s is roughly 6 mmt’s below the latest USDA estimate of 156 mmt’s.

Today’s ethanol report is expected to show stocks of 25.3-26.8 million bbls. At the high end, this would be the largest stocks number in almost a year.

Production is seen in a range of 1.014-1.090 million bbls. This compares to 1.083 last week.

The NASDAQ is up 375 points this morning, following stock darling Nvidia’s better than expected earnings report yesterday. The chipmaker blew past expectations, sending its shares roughly 13% higher in premarket trade.

The Nikkei 225, Japan’s NASDAQ equivalent, also touched a record high on a booming tech sector. Its previous high was set in 1989.

This morning’s US jobless claims report is expected to show initial claims rising on a week-to-week basis; analysts see the number coming in around 215,000, which would be 3,000 higher than last week.

A small trough brought storms and showers across the northern Midwest Wednesday night into Thursday. A similar system is forecast to move through next week as well.

Argentina sees 2 fronts moving through, one today and one Monday, which look to bring needed showers. A more active pattern is still seen beyond March 1.

Brazil continues to see scattered showers through this weekend, before rains become slightly more isolated in nature. Some heavy rains have been seen, which has been welcomed amid a lack of subsoil moisture in some areas.

Have a wonderful day.

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