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Soybeans fall as corn finishes modestly lower

Soybeans were lower on fund and technical selling, managing to finish just above the session lows. U.S. export sales were a marketing year low at just 6 million bushels, reflecting Brazil’s hold on the market due to a price advantage. March beans traded below $12 briefly, but were able to climb back above that psychologically significant mark. Last week’s big buyers of U.S. soybeans were China and Egypt, even if those sales were nothing to write home about, and unknown destinations had a significant cancelation. There’s also talk of imports of those cheaper Brazilian beans into the southeastern U.S. for poultry feeding, which usually happens when domestic supplies are tighter, not after harvest. Brazil’s hold on the market is despite their prices declining as harvest moves forward, even with disappointing yields in some areas and lower production projections from private firms. Near-term weather for Argentina does look hot and dry, with a chance for rain late next week. Soybean meal was lower on profit taking, which also impacted beans and pulled bean oil lower. The USDA says December’s soybean crush was a record for any month at 204 million bushels, up 4 million on the month and 17 million on the year, with soybean meal and oil production also rising.

Corn was modestly lower on fund and technical selling but closing a little shy of the day’s highs. Corn is monitoring development conditions in Argentina and second crop planting in Brazil. The USDA’s updated supply, demand, and production numbers and CONAB’s next outlook for Brazil are both out Thursday, February 8th. Exports have slowed down, but it was a bullish week for sales, shipments remain ahead of last marketing year, and Mexico bought 206,834 tons of 2023/24 Thursday morning. 2023/24 U.S. corn sales last week were 47.5 million bushels, with Japan and Mexico leading the way, and there were another 5.7 million bushels sold for 2024/25 delivery to Japan and Mexico. Stateside, ahead of spring planting, the biggest area of lingering extreme drought in the Midwest is in eastern Iowa. The USDA says 481.699 million bushels of corn were used for ethanol production during December, an increase of 5% from November and 13% from December 2022, with DDGS production of 1,950,562 tons, 9% higher than the month before and 16% above the previous year. The USDA’s attaché in Ukraine says 2023/24 corn production was 30.555 million tons, compared to 26.2 million for 2022/23, with exports this marketing year seen at 29.2 million tons, compared to 27.122 million last marketing year.

The wheat complex was mixed, with nearby Chicago up, Kansas City down modestly, and Minneapolis firm. Export sales were bearish due to Russia’s dominance, also which is also pressuring global prices. Sales last week were 11.8 million bushels, mostly hard red spring and white wheat, with the Philippines and Japan topping the list. There were no outright sales to China and there is some talk Beijing might cancel previously purchased U.S. soft red winter because of more favorable pricing by and a better trade relationship with Russia. Drought conditions have eased in most U.S. winter wheat growing areas, but drier than ideal soils are still present in parts of the hard and soft red winter regions. The USDA says 226.126 million bushels of wheat were used for flour production during the fourth quarter of 2023, a decrease of 2% from Q3 and 1% from Q4 of 2022. The remnants of a tropical storm are headed for parts of Australia, helping to recharge soil moisture for winter wheat planting. The USDA’s attaché in Ukraine says 2023/24 wheat production totaled 23.141 million tons, compared to 22.075 million for 2022/23, with exports pegged at 17.7 million tons, compared to 17.122 million in the previous marketing year.

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