TFM Midday Update 01-07-2025

CORN

Corn continues to trade lower at midday, with futures showing signs of losing momentum due to declining exports and the anticipation of a large South American crop.
USDA confirms the sale of 110,000 tons of US corn for delivery to Columbia in 24/25.
Funds net long position grew significantly last week, reaching a 22-month high, as Argentina’s drying trend attracted new buyers.
Currently, Argentina’s corn production losses are minimal, but if dry conditions persist into the second half of January, concerns are expected to grow.

Soybeans remain lower at midday, despite growing concerns over the heat and dry weather in Argentina. Both soybeans and soybean meal are trading down, while soybean oil is experiencing slight gains.
The upside potential for soybeans has been constrained due to expectations of a record crop in Brazil, the world’s leading soybean producer. Traders will remain focused on the USDA Supply and Demand report, looking for any upward revision to Brazil’s soybean estimate, which currently stands at 169 mmt.
The anticipation of the USDA Supply and Demand report, set for release this Friday, is likely to keep prices volatile in the meantime. Meanwhile, concerns over trade wars will likely continue to cap rallies, as uncertainty surrounding potential changes in tariff policies under the incoming Trump administration persists.

Wheat futures are trading higher at midday, supported by the strength of the dollar and tough export competition, which provide underlying strength to the wheat markets. Additionally, expectations of shrinking supply from Russia, the world’s top wheat exporter, are adding strength.
Approximately 25% of the national winter wheat crop is stressed due to drought, raising concerns about the spring crop. For the US, wheat ratings in Kansas and Oklahoma have declined due to dry conditions in parts of the states, along with other areas in the Midwest.
This week’s heavy snowfall in central and eastern Kansas provided welcome moisture to the winter wheat crop and is expected to offer some cover as the cold snap persists over the next two weeks.
Domestic wheat prices in India continue to rise to record highs, as the government’s sale of wheat stocks and restrictions on how much wheat millers can hold have failed to bring prices down.

Lauren VandenLangenberg