TFM Morning Update 01-29-2024

CORN

Corn was trading in a relatively steady range earlier last night but began selling off around 3am. Economic issues in China were the biggest bearish factor.
Overnight, a Hong Kong court ordered the real estate property giant, China Evergrande, to liquidate. The company now owes 300 billion. This news adds fresh concerns about the Chinese economy and their demand.
International corn prices have risen recently, but in Brazil they have fallen as a result of anticipation of a large Brazilian and US crop.
Friday’s CFTC report showed funds adding to their short position by 4,743 contracts, increasing it to 265,285 contracts. That is the second largest short position in history.

Soybeans are trading lower this morning with pressure from the news out of China along with lower prices in both soybean meal and oil.
Overnight, March soybeans reached its lowest price since June of 2023. There is some technical support around $11.85, but after that, the contract low is down at $11.45.
In Brazil, 9% of the soybean harvest is reportedly complete which compares to 4.4% at this time last year. Northern Brazil is getting a bit too much rain while Argentina is dry in the short-term forecast.
Friday’s CFTC report showed funds as sellers of 15,045 contracts of soybeans which increased their net short position to 91,842 contracts last week.

All three wheat classes are trading lower this morning with KC wheat leading the way lower. Wheat is down with the rest of the grains due to bearish global news.
Fighting in the Middle East is escalating after the US said that Iranian backed militants killed three US service members. Retaliation is expected, and shipping companies are expected to stay out of the Red Sea.
Argentina has said that China is now open to importing Argentinian wheat for the first time. This comes after Argentina wrapped up harvest with production better than expected at 15.1 mmt.
Friday’s CFTC report showed funds as buyers of 4,034 contracts which reduced their net short position to 64,541 contracts as of last week.

Amanda Brill