AM Comments January 9 2025
Good morning. Ag markets are mostly lower this morning to start what is expected to be another choppy day of trading at the board of trade. On one side of the fence we are likely to see position squaring/risk adjustment ahead of tomorrow's January WASDE and quarterly stocks report, and also week-end, while on the other side, a portion of today's trade will be absent due to the proceedings in Washington for former President Carter's funeral. There will be no trading in the stock markets today, with index futures shuttering for the day after the night session ends at 8:30am central time. And this all goes without mentioning the weather situation in Argentina, which as of today remains price driver number 1 in the corn and soybean markets. Corn futures this morning are unchanged to a penny lower, soybean futures are down 3-4 cents, and the Chicago wheat market is down 2-3 cents. Products are lower, soybean meal is down around $2/ton, and soybean oil is down 5-10 points. Outside markets are mixed/quiet, crude oil futures are up 30-40 cents/bbl, the Dow Jones index is down 20 points, and the US$ index is up 10 points. The S&P500 is down 10 points and the NASDAQ is down 50 points.
Today's Reports: None - Jimmy Carter Memorial
- Another day with a similar delivery slate from the CME Group; assigned overnight were another 51 contracts of soybean meal, 171 contracts of soybean oil, and 60 contracts of soybeans.
- Starting with production, the trade for tomorrow's January WASDE report sees corn production coming in slightly smaller than previous at 15.095 bil bu's, with a national average yield estimate of 182.7 bu/acre. Soybean production is seen at 4.453 bil bu's, with a national average yield of 51.6 bu/acre.
- In South America, corn production in Argentina is seen slightly lower from last month at 50.54 mmt's, while soybean production is also seen slightly lower at 51.91 mmt's. In Brazil, corn production is seen marginally higher at 127.05 mmt's vs 127.0 last month, and soybean production is seen at 170.28 mmt's vs 169.0 last month.
- US ending stocks for corn are estimated at 1.675 bil bu's compared to 1.738 bil last month, while US soybean ending stocks are estimated at 457 mil bu, compared to 470 mil last month. Wheat ending stocks are seen at 799 mil bu vs 795 mil last month.
- At the world level, global corn ending stocks are seen at 294.8 mmt's compared to 296.4 last month, global soybean ending stocks are seen at 132.3 mmt's compared to 131.9 last month, and global wheat ending stocks are seen at 257.9 mmt's, compared to the same 257.9 last month.
- The USDA will also release it's quarterly grain stocks report tomorrow morning; this report is expected to show December 1 corn stocks at 12.147 bil bu's, which is similar to last year's 12.171 bil bu's. Soybean stocks are seen at 3.231 bil bu's compared to 3.001 last year, and wheat stocks are seen at 1.565 bil bu's compared to 1.421 last year.
- Lastly, winter wheat seeding data will also be released in the morning; all wheat acres are estimated at 33.366 mil, which would be down just slightly from last year's 33.390 mil. Hard red acres are seen at 23.733 mil, while soft red acres are seen at 6.141 mil.
- Private Brazilian ag consultancy Anec earlier this week said they see January soybean exports out of the country at 1.71 mil tons, which would be down from last year's 2.4 mil tons in the same month, but would be up about 300k tons from the December figure. The group sees total 2025 exports possibly reaching 110 mmt's, which would be up roughly 13 mmt's from last year and up roughly 9 mmt's from the all-time record set in 2023.
- Sources familiar with the matter said on Thursday that Indonesian exports of used cooking oil and palm oil residue in recent years had exceeded production capacity, indicating that crude palm oil had likely been mixed in. This prompted new regulations mentioned earlier this week aimed at keeping domestic crude palm oil supplies at levels that would not cause an increase in prices.
- The CME Group on Wednesday outlined plans to roll out a new hard red spring wheat contract early in Q2 of this year pending regulatory approval. The new futures/options contracts will compete with the MIAX (Miami International Holdings Inc) spring wheat contract, which was formerly under the Minneapolis Grain Exchange until last year.
- Barge shipments down the Mississippi River in the week ending January 4th were seen at 703k tons, which was down more than 25% from the week prior; corn shipments in the week were down 36% at 322k tons, and soybean shipments were down 9% at 374k tons. STL barge rates were down 12 cents/short ton on the week to $15.24.
- Not a lot of new updates this morning to the wild fire situation in/around Los Angeles, as the flames continue to rage and water supplies are running short. Private groups estimate insured losses could approach the $10 billion mark, threatening to make this one of the most expensive natural disasters in US history.
- Other weather news is again mostly unchanged for the US this morning, as the coming winter storm for the Dallas metropolitan area that is expected to stretch through the mid-south and into the southeastern Midwest continues to be the main forecast feature going into the weekend. The GFS still sees the heaviest snows of 6-8" in parts of southern AR, while a more general 2-4" is expected for the rest of the storm's path.
- Elsewhere, lighter snows are forecast for the northern Plains and into the northern Midwest beginning Saturday and lasting through the weekend, while the far northwest and northern Rockies are also expected to see more snowfall beginning through the day tomorrow. Temperature outlooks were again largely unchanged, as the southern half of the country stays well cooler than normal into next week.
- Argentine rains were largely confined to western and west-central growing areas again on Wednesday, while the eastern half of the country and into southern Brazil continued to see another day of dry conditions. Forecasts continue to show light rain potential in the south over the next 72 hours, while the two-week forecast continues to see better rain chances through the central and northern parts of the country; there were again no overnight forecast updates for Brazil.