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Wheat gains with mixed finishes for soybeans, corn

Soybeans were mixed, mostly modestly lower, with the pit ending the week in the red. Beans were up initially, helped out by the sale of 297,000 tons of 2023/24 U.S. beans to China, but did not hold onto those early gains. That is the first announced sale of U.S. soybeans since December 19th, 2023 and the first reported sale to China since December 15th. Sales numbers last week were mixed, up from the previous week, but lower than average at 28.7 million bushels. The big buyers were China and Germany with a cancelation by unknown destinations. Shipments continue to be a bearish factor for soybeans with the pace slowed by Brazil’s control of the global market. Harvest activity is gaining steam in Brazil, with lower crop estimates from private firms. Most of those are around the 150-million-ton mark, with the most notable outlier at 135 million tons. CONAB’s new Brazil guess and updated USDA supply, demand, and production numbers are out February 8th. Soybean meal was mixed on bear spreading, while bean oil was lower on a decline in crude oil and a lack of follow through buying.

Corn was mixed, mostly modestly higher on bull spreading, but unable to avoid a lower weekly finish. Weekly export sales were solid at 49.3 million bushels, with more than half of that to Mexico. Colombia took second place and there were no reported sales to either China or “unknown destinations”. Physical shipments of corn remain ahead of the pace needed to meet projections for the 2023/24 marketing year. That’s even with the shipping issues in the Panama Canal and the Red Sea. A small amount of U.S. corn was sold to Japan for 2024/25 delivery. China reportedly bought a record 4.95 million tons of corn during December, but most of that was from Brazil. Rain is in the forecast for parts of Brazil and while Argentina is drier, conditions are still good.

The wheat complex was higher on short covering and technical buying, along with the mostly lower dollar during the session, while still closing modestly lower on the week. While most U.S. winter wheat has snow cover, winterkill is still a possibility in some areas. Even then, any damage would remain unknown until the crop emerges from dormancy and forecasts generally look warmer and wetter in the coming week. The USDA’s monthly crop weather and condition stories are out later this month. There’s also a chance of winterkill in portions of Russia and Ukraine. Wheat remains oversold, but any sustain gains will likely be limited by the continued slow export demand, due in part to the relative strength of the dollar versus competing currencies. USDA’s delayed export report showed a solid week-to-week increase for wheat, primarily to the Philippines and unknown destinations. The overall pace of shipments continues to be bearish with Russia holding the lion’s share of the world market. Still, the recent decline in global prices has sparked some new demand, which could eventually find U.S. wheat.

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