Grains are steady in overnight trading:

Mar Corn + 1 ¾ cents/bu (6.01 ½ )

Mar Soybeans – 1 ¼ cents/bu (13.83 ½ )

Mar Chi Wheat + 1 ¾ cents/bu (7.63 ¾ )

Cdn $ +0.00245 (79.10 cents)

WTI Crude Oil +1.27/barrel (79.50)

Grains currently sit in the middle of their overnight trading ranges, which have been very narrow.  Volumes are expected to decline dramatically ahead of tomorrow’s USDA January Supply and Demand Report releases.

Prices for corn and beans came under significant pressure yesterday, as extended forecasts for Argentina and southern Brazil increased the possibility of rains for the beginning of next week.  While damage has already been done to the bean and corn crops in Parana and Rio Grande do Sul, it is believed that rains can still help crops about to be seeded in Argentina, and stabilize what is there in southern Brazil.  Soil conditions are extremely parched however, so a lot of moisture is needed.

Brazil’s Conab issued their latest production forecasts overnight, with their cuts to production being a lot more conservative than private forecasters predicted last week.  The government is forecasting total Brazilian soybean production of 140.5 million tonnes (down from 142.8), and total Brazilian corn production of 112.9 million tonnes (down from 117.8).

South American weather forecasts this morning are similar to yesterday afternoon, with Argentina blistering hot and dry this week, but with rains forecast for next week.  Brazil saw good rains in the north and central production zones yesterday, with more of the same for this week, before rains move into southern production zones.