MarketEdge AM Comments
Jan 16, 2024
(Phil Knuth)
Good Morning. Corn futures finished the overnight session lower while soybean futures were higher. March corn was off a penny and a half, settling at 4.4550. March soybeans were up 11 cents, settling at 12.3525. In the outside markets, as of 7:40am: The US Dollar Index is up 860 points, trading at 103.260. February crude oil is up 33 cents, trading at $73.01 per barrel. Precious metals are all lower. Industrial metals are higher, except aluminum. The Electronic Mini-DJIA is off 96 points, trading at 37,696. Soybean futures are attempting to claw their way out of the post-report abyss this morning, but corn futures continue to struggle. Friday’s report was a real kick in the teeth to corn and soybean futures. USDA reported a final 2023 corn yield of 177.3bpa. This figure is 2.4bpa higher than the previous estimate and is nearly one bushel above the highest trade estimate. USDA reported a final 2023 soybean yield of 50.6bpa. This figure is 0.7bpa above the previous estimate and is 0.2bpa higher than the highest trade estimate. Harvested acres for both commodities were lowered slightly but not enough to offset the increased yield figures. USDA even increased the corn feed usage and corn crushed for ethanol estimates and the carryout projection still increased by 31 million bushels, to 2.162 billion bushels. Soybean demand categories were left unchanged and the carryout projection increased by 35 million bushels, to 280 million bushels. To add insult to injury, world corn and soybean carryout figures also exceeded the highest trade expectations. So, the big bad January report has come and gone and has left some burdensome figures for traders to deal with in its wake. Now, focus will shift to 2024. Traders are anxious to see what USDA comes up with for preliminary acreage estimates at the February Ag Outlook Forum. On Friday, the funds sold 6000 contracts of corn, sold 5000 contracts of soybeans, and sold 3000 contracts of wheat. They are now estimated to be net short 246,210 contracts of corn, net short 41,280 contracts of soybeans, and net short 65,750 contracts of wheat. From a chart perspective, March corn finds initial support at the overnight low, 4.4350, followed immediately by the new contract low charted on Friday, 4.41. Initial resistance is at 4.50, followed by the 4.60 to 4.6250 range, which includes the highs from every trading session last week. March soybeans find initial support at the overnight low, 12.2425, followed by the seven-month low charted on Friday, 12.03. Initial resistance is at 12.3775, the overnight high, followed by 12.50. Opening calls are mixed.
Have a great Tuesday.
Good Morning. Corn futures finished the overnight session lower while soybean futures were higher. March corn was off a penny and a half, settling at 4.4550. March soybeans were up 11 cents, settling at 12.3525. In the outside markets, as of 7:40am: The US Dollar Index is up 860 points, trading at 103.260. February crude oil is up 33 cents, trading at $73.01 per barrel. Precious metals are all lower. Industrial metals are higher, except aluminum. The Electronic Mini-DJIA is off 96 points, trading at 37,696. Soybean futures are attempting to claw their way out of the post-report abyss this morning, but corn futures continue to struggle. Friday’s report was a real kick in the teeth to corn and soybean futures. USDA reported a final 2023 corn yield of 177.3bpa. This figure is 2.4bpa higher than the previous estimate and is nearly one bushel above the highest trade estimate. USDA reported a final 2023 soybean yield of 50.6bpa. This figure is 0.7bpa above the previous estimate and is 0.2bpa higher than the highest trade estimate. Harvested acres for both commodities were lowered slightly but not enough to offset the increased yield figures. USDA even increased the corn feed usage and corn crushed for ethanol estimates and the carryout projection still increased by 31 million bushels, to 2.162 billion bushels. Soybean demand categories were left unchanged and the carryout projection increased by 35 million bushels, to 280 million bushels. To add insult to injury, world corn and soybean carryout figures also exceeded the highest trade expectations. So, the big bad January report has come and gone and has left some burdensome figures for traders to deal with in its wake. Now, focus will shift to 2024. Traders are anxious to see what USDA comes up with for preliminary acreage estimates at the February Ag Outlook Forum. On Friday, the funds sold 6000 contracts of corn, sold 5000 contracts of soybeans, and sold 3000 contracts of wheat. They are now estimated to be net short 246,210 contracts of corn, net short 41,280 contracts of soybeans, and net short 65,750 contracts of wheat. From a chart perspective, March corn finds initial support at the overnight low, 4.4350, followed immediately by the new contract low charted on Friday, 4.41. Initial resistance is at 4.50, followed by the 4.60 to 4.6250 range, which includes the highs from every trading session last week. March soybeans find initial support at the overnight low, 12.2425, followed by the seven-month low charted on Friday, 12.03. Initial resistance is at 12.3775, the overnight high, followed by 12.50. Opening calls are mixed.
Have a great Tuesday.