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Grain Comments: 03-07-2024

Good morning.

Ag markets are sharply higher to start Thursday, while fundamental news is mostly the same. Short covering is the likely culprit, as traders prepare for the release of tomorrow’s monthly WASDE report. Corn futures are 6-8 cents higher, and currently trading above resistance, soybean futures are 9-13 cents higher, and the Chicago wheat market is 6-7 cents higher. Products are higher, soybean meal is trading $3-4/ton higher, and soybean oil is up 40-50 points. Outside markets are mixed, crude oil futures are down 30-40 cents/bbl, the Dow jones index is up 30 points, and the US$ index is down 20 points.

March deliveries Thursday included 12 contracts of soybeans, 30 contracts of corn, and 149 contracts of Chicago wheat.

May corn futures are currently trading above the 4.34 resistance area, and are also trading above the 20-day moving average for the first time in 2024.

This morning’s weekly export sales report is expected to show corn sales of 800k-1.4 mil mt’s; soybean sales are seen in a range of 175k-600k mt’s; and wheat sales are seen in a range of 250k-550k mt’s.

Soybean sales are again expected to be relatively poor, as it is anticipated another chunk of unknown sales will be switched out today.

Wheat futures were under pressure Wednesday on rumored Chinese cancelations of US wheat purchases. There is no confirmation of this today. China has 1.5 mmt’s of unshipped wheat sales currently on the books.

The European Central Bank is expected to keep its benchmark lending rate steady on Thursday at 4%, keeping in line with their US and Canadian counterparts.

Yesterday’s EIA energy stocks report showed crude oil inventories were up 1.367 mil bbls, at 448.53 mil bbls. This was a significantly smaller build than analysts had anticipated.

Chinese soybean imports for Jan-Feb were the lowest in five years, weighed down by poor crush margins and fewer ship arrivals during the Lunar New Year holiday, the country announced Thursday.

Soybean imports totaled 13.04 mmt’s in Jan-Feb 2024, compared to a revised 14.3 mmt’s in the same period for 2023.

China’s trade growth overall though grew during the period and was better than economists had forecast. This is a good sign for global trade, and possibly signals a turning of the corner for the industry.

February has broken another monthly heat record, becoming the ninth consecutive month to register as the warmest on record.

South American weather stays mostly like prior runs, with their being discrepancy between the models regarding rainfall for N/C Brazil. The GFS is slightly wetter than the EU model, but both are below normal on precipitation.

Argentina sees good rains over most growing over the next 10 days, as the forecast here is generally non-threatening.

Have a great day!

 

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