CORN HIGHLIGHTS:

• The corn market ended the week with strong gains, driven by a bullish USDA WASDE report. March corn rose 19 ¾ cents for the week. With the strong close, the market will be watching the price action on Monday for follow-through of the buying strength today.
• USDA weekly export sales for the week ending January 2 totaled 455,000 MT—a marketing-year low and well below expectations. The decline was largely due to six countries reducing or canceling prior sales. Despite this, U.S. corn export sales remain 30% ahead of last year. Market watchers will monitor whether this trend persists.
• The USDA cut its 2024-25 corn yield forecast by 3.8 bu/acre to 179.3 bu/acre, reducing production by 276 mb. While demand estimates were trimmed by 75 mb, carryout fell to 1.540 billion bushels, below market expectations. Quarterly grain stocks for corn were reported at 12.074 billion bushels—100 mb below expectations and 90 mb less than last year, with 7.66 billion bushels stored on farms as of November 30.
• Despite dry conditions, Argentina’s crop ratings remain above average, though slightly below last year. Rain chances are expected to improve in the second half of January, offering potential relief to stressed crops.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day sharply higher following a surprisingly bullish USDA report. The big leader was soybean oil which ended 6.59% higher in the March contract which was supported by anticipation of the clean fuel tax credit by the Biden administration. Soybean meal ended the day slightly lower.
• Today’s WASDE report held a bullish surprise in the way of a yield cut which was much larger than expected. Yields were cut to 50.7 bpa from 51.7 bpa last month, and this was lower than the average trade guess of 51.6 bpa. Ending stocks fell to 380 mb from 470 mb. Both Argentinian and Brazilian soybean production were surprisingly unchanged from last month.
• Better Argentinian weather has been pressuring soybean meal, but soybean oil has taken an opposite trend over the past week with large gains both yesterday and today. The Biden administration is expected to release its climate model for clean tax fuel credits next week which trade has been waiting for and has been very friendly to soybean oil.
• Today’s Export Sales report was very poor with the USDA reporting an increase of 10.6 million bushels of soybean export sales in 24/25 and 14,700 bushels for 25/26. This was well below the lowest trade estimate. Primary destinations were to the Netherlands, China, and Indonesia. Last week’s export shipments of 58.1 mb were above the 22.4 mb needed each week to meet the USDA’s estimates.

WHEAT HIGHLIGHTS:

• Wheat closed in mixed fashion, as today’s report data was neutral to bearish for the wheat complex. Another move higher for the U.S. Dollar Index after a stronger than expected jobs report was also negative for wheat prices, despite a higher close for Paris futures.
• The USDA pegged U.S. 2024/25 wheat ending stocks at 798 mb, slightly above December’s 795 mb estimate. Global ending stocks also rose modestly, from 257.9 mmt to 258.8 mmt. Quarterly stocks as of December 1 were reported at 1.570 bb, up from 1.421 bb last year. Winter wheat planted acreage was estimated at 34.1 million acres, exceeding the average trade guess of 31.3 million and up about 2% from last year.
• Russian wheat exports were revised lower by 1 mmt to 46.0 mmt, while Ukrainian exports fell by 0.5 mmt to 16.0 mmt. Australian and Argentine production estimates remained steady at 32.0 mmt and 17.5 mmt, respectively.
• In an update from the Buenos Aires Grain Exchange, as of January 9, Argentina’s 24/25 wheat crop was 98.2% harvested, with the production estimate remaining unchanged at 18.6 mmt; this is above the USDA’s guess today. For reference, last year’s crop totaled 15.1 mmt.
• According to a Russian agricultural regulator, Russia exported 73.1 mmt of grains in 2024, up 4 mmt year over year. Wheat accounted for 57.5 mmt of this total. Combined exports of grains and grain products reached 86.7 mmt, an increase from 83.9 mmt in 2023.

DAIRY HIGHLIGHTS:

• Class III futures suffered losses on contracts through July today. February and March contracts saw the biggest moves lower by 65 and 63 cents respectively.
• Spot cheese dropped and saw its largest loss since October 31st at 0.4875 cents to close at $1.8350/lb. Spot whey was unchanged at $0.74/lb.
• Class IV contracts were mixed on Friday. April futures saw the biggest gain at 12 cents to close at $20.95 while May futures lost 24 cents to close at $20.50.
• Both butter and powder were unchanged on the day at $2.60/lb and $1.3650/lb respectively.

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Author

Amanda Brill