CORN HIGHLIGHTS:

• Corn prices finished 4-7 cents lower heading into the weekend on pressure from rain in South America and weakness in the wheat complex.
• President Trump’s USTR nominee, Jamieson Greer, made comments yesterday that he favors a strong dollar policy, which cooled buying interest overnight and into Friday’s session.
• If an agreement can be reached with Mexico before the implementation of tariffs, we could see Mexico start to buy even more corn in 2025 compared to the record 25.3 mmt they purchased in 2024.
• Much of the Northern Midwest is seeing drought conditions and was highlighted by yesterday’s drought monitor. Drought conditions were 4% worse than last week to 46%. This compares to the 27% of the corn area in the US seeing drought conditions the same week last year.
• The Mato Grosso region of Brazil continues to push forward with planting their second crop. Corn planting is now seen at 23% complete, up 6% from last week, but still below the 5-year average of 33% done by this time.

SOYBEAN HIGHLIGHTS:

• Soybean prices ended the day lower, though they have remained relatively rangebound in recent weeks, with the March contract trading between $10.75 and $10.40. The stronger dollar likely weighed on the entire grain complex, and funds may have taken profits ahead of the weekend. While soybean meal closed lower, soybean oil ended the day higher.
• Estimates for Tuesday’s WASDE report suggest U.S. soybean ending stocks will decrease by 3 mb to 378 mb, while a potential increase in export demand is also expected. Global ending stocks are projected to remain unchanged or slightly lower.
• In South America, Argentinian soybean production was last estimated at 52 mmt but may slip due to recent dry weather. The Brazilian soybean crop is estimated at 170 mmt. Safras has pegged production higher at 174.88 mmt, but the recent harvest delays may have cut that number slightly.

WHEAT HIGHLIGHTS:

• Wheat closed with small to modest losses, pressured by lower corn and soybean futures. Additionally, a higher US Dollar added to pressure. All three March wheat contracts are considered technically overbought and may also be due for a correction to the downside.
• According to Stats Canada, December wheat stocks came in at 24.48 mmt, which was above both the expected 23 mmt, and last year’s 20.68 mmt figure.
• The average WASDE pre-report estimate for US 24/25 wheat ending stocks is projected at 800 mb, which would be up 2 mb from the January report and well above the 696 mb from the 23/24 season. Global wheat carryout is expected to show a slight decrease to 258.7 mmt from 258.8 mmt in January.
• The Russian ag ministry has increased the wheat export tax by 1% to 3984.20 Rubles/mt through February 18. In related news, the Russian wheat export quota is expected to begin on February 15.

DAIRY HIGHLIGHTS:

• Class III milk futures suffered large losses on the day led by the March contract which finished Friday’s trade 62 cents lower at $19.44. Poor spot trading contributed to the weakness seen today.
• Spot cheese fell 1.25 cents today to close at $1.82/lb. The whey trade fell for a third straight day to close at $0.5875/lb.
• Class IV milk futures, along with the rest of the dairy market struggled to stop the bleeding today. Class IV milk prices lost anywhere from 2-36 cents on the day.
• Spot butter fell below the $2.40/lb level for the first time since June 2023, closing at $2.38/lb on Friday. Spot powder lost a penny to close at $1.33/lb, further fueling the weakness in Class IV prices.

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Author

John Heinberg