TFM Morning Update 09-16-2024

CORN

Corn is trading lower this morning after the December contract gained 7 cents in last week’s trade as sellers take advantage of higher prices. Dry weather in the Corn Belt has been supportive over the past few weeks, especially its impact on later planted acres.
While the USDA is anticipating big yields and large production, demand has picked up to match supply. Old crop corn demand increased by 365 mb in last week’s WASDE report and new crop demand is estimated in increase by 45 mb.
Friday’s CFTC report showed funds exiting their short positions and buying back 44,077 contracts which left them net short 132,134 contracts. Over the past three weeks, funds have bought back 125,000 contracts of corn.

Soybeans are trading slightly lower this morning as soybeans remain in rangebound trade over the past three weeks. Dry weather in the US along with the concern over dry conditions in Brazil has been supportive. Soybean meal is trading higher while soybean oil is lower.
Brazil has had months of dry weather and much of the upcoming price action will rely on the weather in the country going forward. They are forecast to receive showers in the South, but central Brazil is still forecast to remain dry for another 10 days. With appropriate rains, Brazil would likely produce a new record crop in 2025.
Friday’s CFTC report showed funds buying back a portion of their short position. They bought back 23,495 contracts which left them net short 130,601 contracts.

All three wheat classes are trading lower this morning and are giving back a big chunk of Friday’s gains. While the fundamentals in wheat have been supportive, the technicals have been well overbought for over a week and may be attracting sellers.
In the EU, wheat output estimates have been lowered to 125 mmt from 135 mmt the previous year as a result of excessive rainfall in the western countries and droughts in the East. Russia has also seen wheat supplies fall since last year as a result of lower production due to weather.
Friday’s CFTC report showed funds buying back wheat by 13,227 contracts which left them net short 29,397 contracts. Funds have been consistently buying back wheat since the end of July.

Amanda Brill