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Market Report

Thursday January 4th, 2018

March 17 corn closed down 2 at $3.51 and July 18 closed down 1 ¾ at $3.67 ¾. March soybeans closed down 1 at $9.67 ¾ and July closed down 1 ¼ at $9.88. March wheat closed down 2 at $4.34 and July 18 closed down 1 ½ at $4.59 ¼. Crude oil closed up $.35 at $61.90.

Up, down, and everything-in-between, has been the trend for corn in this holiday-shortened week. Today, the corn market finished two cents lower, and heading into Friday is unchanged for the week. Managed Money traders were viewed small net sellers again of the day, and could be heading into tonight net short close to 245,000 contracts, futures and options combined. News flow remained sluggish this morning, but we at least had some gov’t reports to lean on for talking points. Export sales report tomorrow is expected to be subdued due to the holiday timing.  Look for 600k to 800k in new corn business. There was little change in South American weather prospects today. Argentina crop stress is expected to be significant over the next ten days, despite some showers today and Friday. Rain advertised for January 13-17 will be extremely important. The latest Buenos Aires Grain Exchange report found corn planting progress at 77%, advancing 7% wk/wk, but well behind normal. Over 40% of the early planted corn said to be tasseling, further reinforcing the need for those mid-month rains.

The headlines will show soybeans ended their three-day rally with a lower close but the ability for the market to bounce off the session low was the more interesting takeaway. That takeaway is that the market continues to consolidate, not ready to break down just yet but also not able to must much of a rally, nothing changes. Meal helped lead beans back today with the meal chart sticking an outside day higher after stabbing into a new low for the move. There is not a lot of fresh news around the grains today with most of the action over in the equity markets where stocks are into new all-time highs trading above 25,000 on the Dow Jones following another strong jobs report and crude oil into a new high trading over $62 with support from a friendly EIA stocks report. In the news, the Buenos Aires Grain Exchange estimates Argy soybean planting at 87.5% complete up from 81.9% last week. Soybean conditions are 52.6% good to excellent and 9.1% poor verp poor.

After a mixed start to the evening, price action overnight was mostly a little lower, with additional weakness seen as we moved closer towards the morning break. As has been the case over the past week, KC was stronger than Chicago. Picking up on more and more wires that a lack of snow cover in Western Europe, Ukraine and southern Russia puts wheat at risk when extreme cold returns. Interesting that temps ten degrees above normal in the Black Sea have kept shipping lanes open longer than normal this winter. Crop report next Friday. There will be a lot of data to absorb as the report includes final corn and bean production, quarterly stocks for Dec 1, as well as an estimate of winter wheat acres. Planted acres should be around one mil below last year’s 32.7 mil. HRW acres are estimated off 700 thou at 22,700 mil.

Anna Kaverman

anna@mercerlandmark.com

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