Written Commentary
Ag Market View for Dec 13.24
December 13, 2024
CORN
Prices were down $.06-$.10 today with spreads weakening. July-24 closed back below both its 50 and 100 day MA’s. Next support is the June low at $4.38 ¼. Same story with Dec-24 corn with next support at $4.58 ¼. With little fresh news to drive prices bearish US weather and speculative selling tilted prices lower. Some heavy, however widely scattered rains fell in the central Midwest yesterday. Heavy rains are forecast for the northwest third of the Midwest over the next week. Both the 6-10 and 8-14 day forecasts show above normal temperatures with normal to above normal rains in the west, normal to below normal in the east. The BAGE held their production forecast unchanged at 46.5 mmt maintaining the production gap with the USDA at 6.5 mmt. Harvest was estimated to have advanced 5% to 40%. Ukraine’s Ag. Ministry raised their 2024 grain production forecast 3.6 mmt to 56 mmt. This forecast includes 28.5 mmt of corn, vs. the USDA est. of 27.7 mmt. The Ag. Ministry expects exports will reach 25 mmt, just above the USDA forecast of 24.5 mmt.
SOYBEANS
The soybean complex was lower across the board with the lone exception being July-24 meal which closed $.10 higher, the minimum tick. Beans were down $.09-$.11, deferred meal contracts were down $1-$3, while oil was down 18. July-24 beans can’t break out of its $11.70 – $12 price range. 50/100 day MA resistance sits at $11.98. July meal traded to new monthly highs. July-24 oil continues to consolidate just below $.44. Spot board crush margins shot up another $.08 to $1.11 ¼, the highest level in 6 months. Although temperatures are heating up, which we see every June/July, US drought readings at near zero, crops can withstand a week or 2 of hot/dry weather before yield reducing stress develops. Ukraine’s Ag. Ministry raised their 2024 oilseed production forecast to 22 mmt which includes 13 mmt of sunflower, 5 mmt of soybeans and 4 mmt of rapeseed. These compare to the USDA est. of 14.7 mmt sunflower, 5.5 mmt soybeans, and 3.7 mmt rapeseed. The BAGE held their production forecast unchanged at 50.5 mmt vs. the USDA forecast of 51 mmt. Harvest was estimated to have advanced to 96%. NOPA crush at 11 AM CST on Monday. NOPA members are expected to have processed 178.35 mil. bu. in May, up from 169.4 mil. in April and slightly above the 177.9 mil. in May-23. Oil stocks are seen falling to 1.775 bil. bu. down from 1.832 bil. in April and 1.872 in May-23.
WHEAT
Prices were $.07-$.11 lower across all 3 classes today. July-24 Chicago has been stuck between its 50 and 100 day MA’s for the past 3 sessions with support at $6.04 and resistance at $6.29. Fresh 6 week lows for July-24 KC, next support is the 100 day MA $6.15 ½. Fresh 7 week lows for July-24 MGEX with next support at the contract low of $6.35. Scattered rains are expected for Eastern Ukraine into Southern Russia providing modest relief from the developing drought. Without fresh demand news harvest pressure and odds of higher production is weighing on Chicago and KC while favorable crop prospects weigh on spring wheat MGEX futures. Ukraine’s Ag. Ministry raised their 2024 wheat production forecast to 21 mmt, contrary to the USDA lowering their forecast 1.5 mmt to 19.5 mmt on Wed. The Ag. Ministry expects exports will reach 15 mmt, vs. the USDA est. of only 13 mmt. The BAGE reports Argentine wheat plantings advanced 20% LW to 46%. I look for US WW harvest to reach 20-22% by Sunday.
Charts provided by QST.
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