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Another down day for soybeans, corn

Soybeans were lower on fund and technical selling, adding to what would have already been a lower finish for the week. December’s soybean crush was a little below expectations, but still the largest for any month at 204 million bushels. Brazil’s harvest is ongoing, while Argentina’s crop condition rating declined for the second week in a row. There is rain in the forecast for parts of Argentina in this coming week, but the timing continues to be uncertain. Projections for Brazil’s crop have trended lower, in contrast to Argentina, where many are still taking a wait and see attitude. Either way, Brazil’s crop will be smaller than last year and Argentina’s will be larger. Soybean meal was lower on follow through selling, slower than anticipated export demand, and the USDA reporting larger than a year ago domestic stocks, while bean oil was pressured by the month-to-month increase in supply, even with stocks below year ago levels.

Corn was lower on fund and technical selling, while still managed a mixed close for the week.  Corn is watching weather in South America, including hot, dry conditions in parts of Argentina ahead of an improved chance of rain late in the coming week. There’s also rain in the forecast for parts of southern Brazil along with a drier pattern for northern growing areas. CONAB’s updated outlook for Brazil is scheduled for Thursday, February 8th. The USDA’s attaché in Argentina estimates 2023/24 corn production at 57 million tons, above the most recent official guess of 55 million and the 2022/23 total of 35 million. Exports for Argentina this upcoming marketing year are projected at 41 million tons, compared to 23.4 million this marketing year. Stateside, soil moisture ahead of spring planting is mostly much better than a year ago, with the USDA’s prospective planting numbers out at the end of March.

The wheat complex was mixed, with the most active months also ending the week mixed. Contracts are oversold, but the dollar was up during the session and export demand for U.S. wheat continues to be slow. Russia’s Union of Grain Exporters says that since the start of the marketing year on July 1st, 2023, wheat exports are 29.5 million tons, 13% ahead of the previous marketing year. Russia’s control of the export market has also eaten into the market share of Europe and Ukraine, which is still exporting grain despite the ongoing war. There’s talk, but no confirmation, of China buying wheat from France. The USDA’s attaché in Argentina sees 2023/24 wheat production at 15.4 million tons, compared to 12 million in 2022/23, with exports of 10.2 million tons, well above the 3.662 million tons exported last marketing year. U.S. hard and soft red winter growing areas have benefited from recent improvements in precipitation, while parts of Canada and western Europe remain drier than ideal. New USDA supply, demand, and production numbers are out on the 8th, with the department’s Ag Outlook Forum running on the 15th and 16th.

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