Grains are lower in overnight trading:
Mar Corn – 3 cents/bu (6.06 ½ )
Mar Soybeans – 3 ¾ cents/bu (13.86 ¼ )
Mar Chi Wheat – 9 cents/bu (7.61)
Cdn $ -0.00100 (78.59 cents)
WTI Crude Oil +0.41/barrel (77.40)
Grains traded both sides of unchanged overnight, but have admittedly spent more time in negative territory. March soybeans actually traded to a 4 ½ month high overnight, as concerns continue to build over dryness in the southern regions of South America. Producers on both sides of the border took advantage of yesterday’s big price rally to price up a lot of stored corn and soybeans. Part of yesterday’s explosive move higher was tied to unconfirmed rumors that China was in the market for both corn and soybeans – those rumors included suggestions of a potential 5 to 7 million tonne purchase of corn.
While Tuesday’s price rally was most welcome, the looming USDA January Supply and Demand report looms large, with it’s release scheduled for Wednesday, January 12th. The January report will contain the final USA 2021 production numbers, along with revisions to USA and world supply and demand tables. The trade was somewhat shocked earlier this week by the StoneX cuts to Brazilian soybean and corn production estimates. The trade does not expect the USDA to make such dramatic changes, although a slight downward revision to Brazilian soybean production is expected.
This morning, weather maps continue to show dry conditions in Argentina for the next 10 days, although there are increased chances for rain in the 11 to 15 day window. Brazil saw good rains yesterday, particularly in the eastern half of the country. The next 10 days in Brazil sees weather settling into a start wet north/dry south pattern, although again weather models are suggesting the possibility of southern Brazilian rains in the 11 to 15 day window.