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Grain Comments: 03-25-2024

Good morning.

Markets are mostly mixed with light volume to start the new week at the CBOT. Wheat markets started the night higher on renewed nervousness over supply availability out of Russia/Ukraine but have drifted back towards unchanged as night trade has gone on. This week is all about Thursday’s quarterly stocks and seeding intentions reports, with no markets Friday for the good Friday holiday. Corn futures are a penny lower; soybean futures are 1-2 cents higher, and the Chicago wheat market is up 5-6 cents. Products are mixed, soybean meal is down $2/ton, while soybean oil is up 40-50 points. Outside markets are also mixed, crude oil futures are trading 30-40 cents/bbl lower, the Dow Jones index is down 100 points, and the US$ index is down 15 points.

Friday’s COT report showed as of March 19th managed money traders were short 242,988 contracts of corn futures/options, short 148,339 contracts of soybean futures/options, and short 80,570 contracts of wheat futures/options.

For the week, managed money bought 12,940 contracts of corn, bought 6,798 contracts of soybeans, and sold 1,700 contracts of Chicago wheat.

While short positions in corn and soybeans have been trimmed recently, fund manager’s combined grain and oilseed position has still only been shorter than now one time in the last 10 years, and that was 2018/2019 (trade war).

For the week ending March 18, French soft wheat conditions were unchanged with 66% of the crop rated g/ex. This compares with 94% at this time last year.

The USDA attach√© in Brazil lowered its estimate of the Brazilian soybean crop to 152.6 mmt’s, which is down 6 mmt’s from their previous estimate.

For Thursday, trade estimates 2024 soybean acres at 86.5 mil vs 83.6 mil in 2023; trade sees March 1 stocks at 1.828 bil bu vs 1.687 LY. Corn acres are seen at 91.8 mil, vs 94.6 mil LY; March 1 stocks are seen at 8.445 bil bu, vs 7.396 LY.

All wheat acres in 2024 are seen at 47.3 mil vs 49.6 LY, and March 1 stocks are seen at 1.047 bil bu, compared to 941 mil bu LY.

Friday’s cattle on feed report showed as of March 1, the feedlot herd was up 1.3% from last year, which was slightly more than expected. February placements were 9.7% higher, while marketing was up 3.4%.

US federally inspected pork production was up 2.6% last week, at 546 mil lbs. Beef production at 500 mil lbs., was down 0.2% on the week.

Over the weekend, Congress was able to pass a $1.2 trillion budget bill to avert a government shutdown. The bill will now keep the government funded through this fiscal year, which ends in September.

Also, over the weekend, a suspected terrorist attack on a concert hall near Moscow, Russia left 137 people dead, and more than 180 others injured.

South American weather was mostly unchanged over the weekend; rainfall for Brazil has been moved slightly further to the West but is still seen covering most of the Central part of the country over the next 10 days.

Southern Brazil into Argentina will be mostly dry over the next 10 days, which will be welcome following heavy rainfall the last week to two weeks. Temps for Brazil are seen running average to below average, while Argentina has a slightly warmer bias.

The US Midwest sees a storm system producing heavy snow and storms in the Western Corn Belt Monday, with the system moving North and East. Rainfall over the next two weeks also looks to favor parts of the Southern Corn Belt, which combined will lead to an overall boost in soil moisture going into spring.

Temps in the Midwest look to be cool to start the week, but then warm up by mid-week into weekend. Longer range forecasts continue to indicate a return to above average temps beyond the first week of April.

Have a great day.

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