Market News

Soybeans climb, helped out by a higher move in bean oil

Soybeans were higher on short covering and technical buying. There are chances for hotter, drier weather in portions of South America over the near term, potentially expanding later in the month. That’s going to be watched closely until the pattern emerges, if it emerges. The USDA’s next round of supply and demand estimates is out February 10^th, with CONAB’s updated outlook for Brazil slated for February 12^th. Beans will also be watching the export market closely. No one’s been willing to put their name on it and concrete amounts have been hard to come by, but if China has reached its 12-million-ton purchase mark as rumored, Beijing might not buy substantial amounts of U.S. beans again for quite some time. The trade deal framework reached between the U.S. and China late last year remains unsigned. ANEC sees Brazil’s January soybean exports at 3.79 million tons, compared to last week’s guess of 3.73 million. There was also spillover support from strength in soybean oil, which hit multi-month highs, even if wasn’t attached to anything firm, just more background talk about biofuels policy. Soybean meal futures were down on product spread trade.

Corn was mostly weak, consolidating after running into resistance. Corn is monitoring development weather in Argentina and Brazil ahead of that potential hot, dry turn. However, that’s still several days away and the trade seems to have dialed in the record estimates for Argentina and the sizable crop expectations in Brazil. ANEC projects Brazil’s corn exports for January at 3.45 million tons, compared to the week ago estimate of 3.27 million. Ahead of the open, the USDA announced sales of 195,000 tons of U.S. corn to unknown destinations and 150,000 tons to Colombia, both for 2025/26. The trade will be watching the eventual destination of that sale to unknown very closely. Taiwan reportedly picked up 65,000 tons of U.S. corn as well. On the demand front, the U.S. Energy Information Administration’s weekly ethanol numbers are out Thursday and the USDA’s weekly export sales report is set for Friday, both delayed by Monday’s holiday.

The wheat complex was mixed, with Chicago and Kansas City down and Minneapolis up. Much of the Midwest and Plains will see another round of bitterly cold conditions later this week and this weekend, potentially damaging winter wheat. Still, that’s expected to come with some snow cover and it’s hard to quantify freeze damage until the crop emerges from dormancy. Wheat is also watching overwintering conditions in Europe, Russia, and Ukraine. Global demand for U.S. wheat continues to hold up well despite a relatively high price and the growing global supplies. Commodities and financials breathed a tentative sigh of relief Wednesday, with new U.S. tariffs against the European Union seemingly off the table, at least for now.