Grain Comments: 1/11/2023

Good Morning:

Corn and soybeans look to be digging in ahead of the USDA data dump tomorrow, while wheat holds near yesterday’s low; foreign buyers did log a few sales this morning despite generally-overpriced U.S. supplies.

U.S. precipitation today and tomorrow will be heaviest south/southeast, with the 6-10 day still looking wet, drier today for the 11-15 day. Temps remain warm for at least the next ten days, potentially closer to normal past that.

Argentina did see some light rains southwest yesterday, with the best chances north through tomorrow then back to the SW again for the 6-10 day, but dryness concerns linger for most of the country going forward. Brazilian rains fell north to south over the past 24 hours, continuing to spread through much of the country through Sunday, before a generally drier 6-10 day period.

Elevated positioning for tomorrow’s USDA reports will be seen in today’s session. At 11:00 AM CT tomorrow the USDA will release the monthly WASDE report along with the quarterly stocks report for December 1st and the initial winter wheat crop assessment data. There is little doubt there will be something for everyone in these reports. The most interest is falling on the WASDE report as it will contain the final production numbers for the 2021/22 production season. The quarterly stocks may be where a surprise comes from as it will confirm what we have seen for 1st quarter consumption. Trade will also be heavily interested in the ethanol manufacturing data that will be released this morning. Production dropped considerably last week but even so stocks were down just a minimal amount. This proves that energy demand has faded in the US and will likely continue to do so as economic worries start to impact consumer spending. US ethanol reserves are up 14% on the year and this applying pressure to margins. Not only is a lack of demand weighing on ethanol margins but so are transit issues that are affecting interior movement.

Have a great day!