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Soybeans, corn extend rally
Soybeans were higher on fund and technical buying. Contracts continued to move off of the recent lows, but still ended the week with losses following Wednesday’s drop. Brazil’s recent moves to shore up their currency after a significant devaluation this year were also supportive. Near-term crop weather looks good in Brazil and slightly drier for parts of Argentina, which helped prop up bean meal. Bean oil was pressured by losses in palm oil and questions about the extension of biodisel blender tax credits. There was more talk but no confirmation of China buying U.S. soybeans, possibly in an effort to get ahead of potential tariffs in 2025. China’s General Administration of Customs says soybean purchases from Brazil during November were down 25% on the year, while purchases from the U.S. were up.
Corn was higher on fund and technical buying, pulling the most active months to a modestly higher weekly finish. Corn is watching development weather in South America, expecting big crops in 2025. The USDA’s updated supply, demand, and production numbers are out January 10th, while CONAB’s updated outlook for Brazil is set for January 14th. The big test for South America is Brazil’s second crop, which will be planted next year, after the widespread soybean harvest gets underway. Overall demand continues to be solid, with Colombia buying 150,000 tons of U.S. corn Friday morning, bringing Colombia’s announced purchases for the week to 285,000 tons. Including the 170,400 ton buy from Mexico, that’s a solid reported sales total of 455,400 tons. The strong demand for several key customers has offset some of the concerns about slower sales to China. Domestic feed and fuel demand are also positives.
The wheat complex was mixed, mostly firm, while ending the week in the red. Russia’s government has lowered its export quota starting in February by 400,000 tons to 10.6 million tons, which could open up some opportunities for U.S. wheat abroad. Moscow is also set to raise wheat exports tariffs in the second half of the marketing year. Still, any improvement in global demand for U.S. wheat depends on the value of the dollar, which did dip Friday after hitting two-year highs earlier in the week, and how aggressively Argentina and Australia market their new crops, with both nations currently harvesting. Argentina’s harvest has reportedly passed the 75% mark.
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