Grain Comments: 02-28-2023

Good Morning

Corn led the volume overnight, but soybeans were the loss leaders, easily with the furthest to fall off recent highs, with the $15 mark tested for only the second time in a month. It’s been an up-and-down month for the grains and commodities in general, but the dollar has had a strong Feb bounce.

Mexico’s economy ministry yesterday called the U.S. disagreement over its genetically modified corn ban “politically motivated” and reiterated that its position on GMO corn imports is within the USMCA rules.

Light precipitation lingers in the north through tomorrow with heavier action moving through the south Thurs/Fri, including another chance for the southern Plains; an active pattern continues up thru mid-March, with temps still cold.

Most of Argentina remains dry going forward, with Brazil wet through Saturday after light rains over the past 24 hours. 6 to10 day forecasts are wet in center-north Brazil with dry conditions lingering in the south.

The main focus of today’s session will be final month end position squaring. This will be more evident today as the spot contracts are all in the delivery period. While this will impact trade activity, the main focus of the market remains South American weather and production. Several analysts have lowered their crop estimates in recent weeks and nearly all are below the USDA February WASDE estimates. This is especially the case on Argentine production where sizable crop loss has been reported. While crops have been stressed in this region, we are starting to see some questions over actual loss, especially on the Argentine corn crop. Argentine farmers split their corn planting into two seasons with the bulk being produced later in the year. Recent rainfall has benefitted this crop, but how much is uncertain. Argentina has received several unexpected rains recently and there are some thoughts these have provided relief from stress. As a result, some crop scouts have been hesitant to lower production as much as others. This is also a similar weather pattern that the US experienced last year where even with losses total crop sizes were larger than expected.

Have a great day!