Market News

Talk of new demand from China supports soybeans

Soybeans were higher on commercial and technical buying. President Trump says China might buy more U.S. soybeans this marketing year, but there are very few details at this point. If there’s an impediment, outside of the tenuous nature of trade negotiations, its storage logistics, as China has also been buying significant amounts of soybeans from Brazil after hitting the previously agreed upon 12-million-ton purchase mark for U.S. beans earlier this year. Still, any concerns went on the back burner pretty quickly, with the trade choosing to focus on the potential for tighter domestic supplies. The trade deal framework reached late last year between the U.S. and China remains unsigned. The trade’s watching Brazil’s record harvest move forward and waiting for rain in dry parts of Argentina starting later this week. The USDA’s next round of supply and demand numbers is out February 10^th, with CONAB’s updated outlook for Brazil set for the 12^th. Soybean meal and oil futures were higher, buoyed by the rally beans. Bean oil saw additional interest tied to biodiesel expectations.

Corn was mixed, mostly steady to firm. Corn is monitoring South America, with rain in parts of Argentina expected to boost crop ratings. It remains to be seen how much total damage has been done, with most of the impact on early planted corn. The trade’s also monitoring the first crop harvest and second crop planting in Brazil. Ethanol production was a multi-year low because of last week’s winter storm. The U.S. Energy Information Administration says production was the lowest since mid-April 2024, averaging 956,000 barrels per day, down 158,000 on the week and 156,000 on the year, with stocks at 25.136 million barrels, a decline of 264,000 from the previous week and 1.276 million from a year ago. The big bright spot was ethanol exports, which had their third highest record average at 216,000 barrels per day, up 59,000 from the week before and 110,000 from last year. Ahead of the open, unknown destinations bought 130,480 tons of 2025/26 U.S. corn, with the USDA’s weekly sales numbers out Thursday morning.

The wheat complex was lower on fund and technical selling. The USDA’s monthly winter wheat condition ratings were mixed after a generally frigid January in much of the Midwest and Plains. Any significant freeze damage won’t be known until the crop emerges from dormancy in spring. Wheat is also watching overwintering conditions in Europe and the Black Sea region, while waiting to see what happens with negotiations to end Russia’s war on Ukraine. There was another round of pressure from firmer trade in the U.S. dollar and rising global supplies. The USDA’s attaché in Canada says combined 2025/26 wheat production was a record 39.955 million tons, compared to the 2024/25 total of 35.939 million. Exports during the current marketing year are projected at 29.5 million tons, compared to 29.288 million last marketing year, with domestic consumption also expected to rise.