FROM ALL OF US AT TOTAL FARM MARKETING, HAVE A HAPPY AND PROSPEROUS NEW YEAR!

TUESDAY, DECEMBER 31: The CME has regular trading hours, and Total Farm Marketing offices will close at 3:00 p.m. (CT).

WEDNESDAY, JANUARY 1: The CME and Total Farm Marketing offices are closed.

CORN HIGHLIGHTS:

• Grain markets saw additional buying strength to close out 2024, with corn futures benefiting from light trading volume and buying momentum in the soybean market, posting moderate gains. However, the March corn futures closed 56 cents lower compared to the end of 2023.
• The buying strength on Tuesday pushed the corn market past Monday’s potential bearish reversal, trading above Monday’s high. March corn closed Tuesday at its highest price level since June 26.
• Managed money is still growing a net long position in the corn market. As of December 24, managed funds were net long 160,947 contracts, adding 1,532 net long positions from the previous week. Analysts estimated that fund length may be closer to 200,000 long contracts given the recent corn market strength as a favorable demand tone has supported the corn market.
• The corn market is likely to start focusing on next Friday’s USDA WASDE report and Quarterly Grain Stocks report, scheduled for release on January 10. Money flow could remain positive, supporting the market amid expectations that strong demand may tighten corn stockpiles for the seventh consecutive month, as current corn ending stocks are nearly 400 mb lower than last year’s totals.

SOYBEAN HIGHLIGHTS:

• Soybeans closed sharply higher to wrap up the final trading day of 2024, supported by a drier 10-day forecast for Argentina, gains in soybean meal and oil, and likely some fund profit-taking. Crude oil also ended the day higher, which may have provided additional support to soybean oil.
• The USDA attaché in Brazil is now estimating the 24/25 crop in the country at 165 mmt. Planted acreage grew from last year, and crop estimates have continued to grow as the season continues. Brazilian weather forecasts remain favorable while Argentina may see a stretch of drier weather coming up.
• Yesterday’s CFTC report saw funds as buyers of 8,369 contracts of soybeans as of December 24. This reduced their net short position to 67,883 contracts. With funds currently holding a large net long position in corn but a short position in soybeans, there may be room for funds to continue buying back contracts.
• In Indonesia, the government is planning on raising the biofuel blending requirement to 40% next year. This could cause fuel retailers and palm oil suppliers to face higher costs. The increase in demand for palm oil could be supported to soybean oil.

WHEAT HIGHLIGHTS:

• Wheat managed to grind higher into the close, supported by stronger corn and sharply higher soybeans. Matif wheat also saw a strong close, with the front-month March contract finishing above its 200-day moving average for the first time since October. However, a higher US Dollar Index may have capped the upside for wheat today.
• A ‘polar vortex’ is expected to move into the US this week, potentially bringing below-freezing temperatures. This cold snap could affect southern wheat areas, where there is little to no snow cover. The risk of frost and freeze damage could be bullish for the market.
• According to CONAB, Brazil’s 2024 wheat planted area is approximately 12% smaller than the previous year, totaling 3.061 million hectares. However, production is expected to rise by 13% compared to the last crop, with the 2024 harvest estimated at 8.064 mmt, a slight decrease of just 0.4% from 2023.
• According to the CFTC’s Commitments of Traders report, managed funds sold approximately 7,600 contracts of Chicago wheat and 1,900 contracts of Kansas City wheat. They were net buyers of a small amount of Minneapolis futures. However, the total short position in wheat, at nearly 157,000 contracts, is the largest in eight months.

DAIRY HIGHLIGHTS:

• Class III futures finished in the red today led by the April contract which lost 30 cents to $19.53. The February contract backed off of contract highs made yesterday to close at $20.38.
• Spot cheese was up for a third straight day, gaining 0.875 cents to close at $1.8675/lb. Whey was unchanged at $0.75/lb.
• Class IV futures suffered losses ranging between 4 and 30 cents. The January contract dipped below $21.00 to $20.94 for the first time since December 19th.
• Spot butter fell a couple of pennies to $2.55/lb in what remains a mixed trading environment. Powder lost 1.75 cents to close out 2024 at $1.3750/lb.

Total Farm Marketing and TFM refer to Stewart-Peterson Group Inc., Stewart-Peterson Inc., and SP Risk Services LLC. Stewart-Peterson Group Inc. is registered with the Commodity Futures Trading Commission (CFTC) as an introducing broker and is a member of the National Futures Association. Stewart-Peterson Inc. is a publishing company. SP Risk Services LLC is an insurance agency. A customer may have relationships with all three companies. TFM Market Updates is a service of Stewart-Peterson Inc. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.

Author

John Heinberg