AM Comments December 26 2024
Good morning. Merry Christmas. Grain markets are called mixed to start Thursday's trading, as there were no overnight markets last night. News over the last 48 hours has remained largely limited, and we would expect more of the same to continue on Thursday. Markets will see delayed weekly jobs data this morning, but otherwise, the newswire is expected to be largely quiet for the day after Christmas; ethanol data for the week will be out tomorrow, Friday, and is the only other real data of note scheduled the rest of the week. Outside markets are mixed so far, crude oil futures are up 40-50 cents/bbl, the Dow Jones index is down 140 points, and the US$ index is near unchanged. The S&P500 is down 20 points and the NASDAQ is down 75 points. All three stock index futures have pushed to new highs for the week overnight before turning lower, but have traded small ranges otherwise.
Today's Reports: Weekly Jobless Claims
- Only real headline news since Tuesday was a Christmas Day missile barrage by Russia against Ukraine which targeted the country's energy infrastructure as the war between the two countries drags into its third year. US President Biden denounced the attacks and asked for new military aid to be pushed through in response.
- As we mentioned Tuesday, key the rest of this week/year technically for the corn market will be whether prices can push above the current double top near 4.52, while soybean futures need to see the contract lows made late last week at 9.45 1/4 hold. Longer term, most feel soybeans could challenge $9 while corn likely trades between $4.25-4.50 until safrinha planting gets started in South America in February/March.
- Thursday looks to be an active day weather-wise across the US, as the PNW is expected to see heavy rains/winds/snow, while a rain event also seen developing in E TX this afternoon and working north and east through the rest of the week and into the weekend. The upper Midwest sees snow/ice potential late Friday into Saturday as temps drop, but otherwise most of the precip here looks to fall as rain.
- Extended range forecasts have again shifted dryer over the past few days, and now offer mostly below average precip chances for all of the country besides the PNW January 3rd-9th. On the temp side, it remains likely that some sort of cool-down occurs beyond the first of the year, but the EU AI model now sees this cold as short-lived and far less severe than was seen on Tuesday, with a return to much above average temps shortly there after. The ensembles still see a colder pattern January 5-10, which will need monitoring.
- Weather in South America was mostly as expected through the Christmas holiday, with Argentina staying mostly dry and Brazil seeing normal rains through most of the country. Far southern Brazil continues to be dry, but the rest of the country picked up rains ranging from 0.1-1", with come locally heavier amounts.
- Forecast the rest of the week calls for more of the same generally speaking, as Argentina will be mostly dry through the weekend, while Brazil sees a corridor of rains through Mato Grosso, Goias, and Minas Gerais, while other areas will be missed. Models see this pattern generally holding into next week, before light/scattered rain potential returns to areas further to the south and in western Argentina.
- Forecasts also now see temperatures in Argentina rising to well above normal in the southeast, which along with a lack of rainfall, will raise crop stress going into the first of the year. We would not classify this as overly alarming at this point amid good soil moisture levels, but the pattern will need monitored as we get into January.