Ag Market View for Jan 5.24


Today’s lower trade brought fresh contract lows to all the old crop contracts.  Next significant support below the market for spot Mch-24 is $4.47, the Dec-23 low on the weekly chart.  The FAO World Food Price Index fell 1% in Dec-23, was down 10% for all of 2023 and at the lowest level since Feb-21.  No export announcements despite US corn available below SA supplies into the Spring.  Export sales at only 15 mil. bu. were below expectations and a new MY low.  YTD commitments at 1.173 bil. are up 37% from YA vs. the current USDA forecast of up 26%.  The BAGE reports Argentina’s corn plantings have reached 78%.  Ag. group Anex in Brazil expects their corn exports in Jan-24 will reach only 3.3 mmt vs. 4.9 mmt YA.  The Brazilian Govt. states corn exports from Dec-23 reached 6.1 mmt, just below the 6.24 mmt reached in Dec-22. 


Prices were lower across the board today with beans down $.11 – $.13, meal was $3 – $7 lower, while oil was down 40 – 50.  Mch-24 beans traded to a fresh 6 month low with next support at $12.50 ½.  Resistance is at a gap on the charts from Tuesday’s open between $12.90 ¾ – $12.96 ¾.  Mch-24 oil made new lows late closing below yesterday’s low.  Mch-24 meal slid to a new 3 month low with next support at the Oct-23 low of $365.  Above normal precipitation is still expected across the northern half of Brazil’s corn and soybean areas thru midmonth.  By day 10 of the outlook a dryer trend looks to develop, which will be welcomed after 3 weeks of healthy rainfall totals.  Conditions are expected to remain favorable for Southern Brazil and much of Argentina thru mid-January.  Export sales at only 7 mil bu were below expectations and a new MY low.  YTD commitments at 1.343 bil bu are down 16% from YA, vs. the USDA forecast of down 12%.  The BAGE reports Argentine soybean plantings have reached 86% vs. 94% YA and 5-year Ave. of 90%.  Crop ratings improved 2% to 42% G/E, vs. only 7% YA.  Only 2% of the crop is rated poor.  Anec expects Brazil’s soybean exports will reach 1.3 mmt in Jan-24, up 38% from Jan-23.  Brazil’s Govt. states bean exports in Dec-23 reached 3.8 mmt, double the 1.9 mmt from Dec-22. The US Ag. Attache in Brazil lowered their soybean production forecast to 158.5 mmt, below the official Dec-23 USDA est. of 161 mmt.  Safras & Mercado lowered their Brazilian production forecast nearly 7 mmt to 151.36 mmt, joining a host of estimates between 150 – 155 mmt. 


Prices held at slightly higher levels across all 3 classes today making wheat the shining star in the Ag. space.  Chicago Mch-24 is now $1.55 over Mch-24 corn, nearly $.30 off yesterday’s low.  Mch-24 Chicago held support above its 100 day MA at $6.12.  Much below normal temperatures are expected to invade both the central US and Eastern Europe by midmonth.  Anticipated snow cover will likely prevent significant damage to winter wheat crops.  Export sales at only 5 mil. bu. were below expectations.  YTD commitments at 561 mil. are up 2% over YA, vs. the USDA forecast of down 5%.  The BAGE reports Brazilian harvest jumped 12% LW to 84% complete.  They also raised their production forecast .4 mmt to 15.1 mmt, now just above the Dec-23 USDA est. of 15.0 mmt.  A South Korean flour mill reportedly bought 89k mt of US milling wheat, while Taiwan bought 83k of US milling wheat.  Jordan is reportedly seeking another 120k mt of optional origin wheat. 

See more market commentary here.

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