Good morning!
Corn and beans weaker, wheat firmer this morning... Grain markets held in tight price ranges overnight, with corn and soybeans trading lower and on session lows early this morning while wheat is firmer. As of 6:30 a.m. CT, corn futures are trading 2 to 3 cents lower, soybeans are around a penny lower and wheat futures are 2 to 5 cents higher. The U.S. dollar index is down around 120 points and front-month crude oil futures are about 90 cents lower.
Trump, Putin agree to Ukraine talks... President Donald Trump agreed in a phone call with Russian President Vladimir Putin to start negotiating an end to the war in Ukraine. Trump said the U.S. would start negotiations immediately, indicating he’ll probably meet Putin in Saudi Arabia in the “not-too-distant future.” European officials got no advance warning of Trump’s call with Putin, Bloomberg reported. Ukraine and Europe must be part of negotiations and Kyiv should be provided with strong security guarantees, according to a joint statement from France, Germany, Italy, Poland, the UK, Spain and European Union officials. China supports a meeting between Trump and Putin to end the war.
Trump’s reciprocal tariffs to be announced today... Trump said he plans to unveil reciprocal tariffs today but gave no other details. “Today is the big one: reciprocal tariffs,” Trump wrote on his social media platform. “Very simply it’s if they charge us, we charge them,” Trump said. Indications are that autos and pharmaceuticals will be exempt from the tariffs.
Weekly Export Sales Report out this morning... For the week ended Feb. 6, traders expect:
| 2024-25 expectations (in MT) | Last week (in MT) | |
| Corn | 800,000-1,700,000 | 1,477,187 |
| Wheat | 200,000-600,000 | 438,867 |
| Soybeans | 300,000-800,000 | 387,718 |
| Soymeal | 200,000-600,000 | 530,553 |
| Soyoil | 0-25,000 | 2,188 |
Brazil trims soybean production forecast, raises corn crop... Brazilian crop supply agency Conab trimmed its soybean production forecast by 310,000 MT to 166.01 MMT, citing “irreversible crop losses” in southern Brazil caused by a drought. That’s below forecasts from USDA and private crop watchers. Conab raised its Brazilian corn production outlook to 122.01 MMT, up 2.46 MMT from last month, after its first assessment of safrinha production. Conab expects Brazil to export 105.44 MMT of soybeans (down 30,000 MT from January) and 34 MMT of corn (unchanged) in 2024-25.
Exchange cuts Argentine corn production forecast... The Rosario Grain Exchange cut its Argentine corn production forecast by 2 MMT to 46 MMT due to heat and moisture stress. The exchange forecasts the country’s soybean production at 47.5 MMT, around 5 MMT less than if weather conditions were favorable, and warned crop potential could decline more depending on rains over the next 10 days.
U.S. wheat should be spared from winterkill damage... Bitter cold temperatures hit U.S. winter wheat areas overnight. World Weather Inc. says most of the wheat produced in this region should not have been vulnerable to damage from the arctic temps because of widespread snow cover. However, the forecaster noted there is still considerable debate over whether serious crop damage occurred in January when bitter cold overspread the same region with limited or no snow cover.
Strategie Grains raises EU wheat production forecast... Strategie Grains slightly increased its wheat production forecast for the European Union to reflect improved planting conditions and a response to competitive market dynamics. The French consultancy now expects EU wheat production to reach 127.7 MMT, up 500,000 MT from its prior forecast and 14 MMT (12.3%) above last year. However, the firm noted, “The threat of yield losses persists due to excess moisture in west Europe and lack of rain in southeast Europe.”
Senate to vote today on nominations of RFK Jr. and Brooke Rollins... The Senate Wednesday advanced Robert F. Kennedy Jr.'s nomination for Secretary of Health and Human Services via a 53-47 vote along party lines, setting the stage for a likely confirmation vote today. Given the current party-line support, it appears likely that Kennedy will be confirmed as the next Secretary of Health and Human Services. USDA Secretary nominee Brooke Rollins is also up for a likely Senate vote and will be easily approved.
Key House vote today on budget resolution... The House goes on recess after today until Feb. 24. The makes today’s House Budget panel vote on a budget resolution a major one. Link to our special report on the topic.
China’s central bank pledges to adjust policy to support growth... China’s central bank said it would adjust its monetary policy at the appropriate time to support the economy amid rising external headwinds. The central bank pledged to make comprehensive use of its monetary policy toolkit, including interest rates and its bank reserve requirement ratio, and “adjust the intensity and pace of policy measures based on domestic and international economic and financial conditions.” It also plans to keep liquidity ample, promote a reasonable rebound in prices and keep the yuan exchange rate basically stable at a “reasonable and balanced” level.
UK economy shows surprising growth... Britain’s economy unexpectedly grew 0.1% in the final quarter of last year. Economists expected a 0.1% contraction. On an annual basis, British GDP expanded 1.5%, the strongest performance since October 2022. However, headwinds include weak demand in Europe, higher energy prices and the prospect of a slowdown in global trade due to U.S. tariffs.
Egg prices hit record high... The latest monthly consumer price index showed that the average price of a dozen Grade A eggs in the U.S. reached $4.95 in January, eclipsing the previous record of $4.82 set two years earlier and more than double the low of $2.04 in August 2023, the Associated Press reported. Relief is not expected anytime soon, as highly pathogenic avian influenza cases continue to hit layer flocks and the peak demand season around Easter is ahead.
Wholesale beef prices continue to fall... Wholesale beef prices dropped $3.20 for Choice to $319.26 and $3.07 for Select to $309.14 on Wednesday. While spot movement improved to 176 loads, retailer demand has been seasonally weak and isn’t expected to improve much until late winter/early spring.
Bigger jump in cash hog index... The CME lean hog index is up another 89 cents to $87.08 as of Feb. 11, marking the biggest daily increase in the seasonal price rise. The index has jumped $6.65 since the seasonal low on Jan. 9.
Overnight demand news... South Korea purchased 132,000 MT of corn expected to be sourced from the U.S., South America or South Africa. Algerian purchased between 360,000 and 400,000 MT of optional origin milling wheat, with much of it likely to be sourced from Romania, Bulgaria and Ukraine. Taiwan tendered to buy 102,450 MT of U.S. milling wheat. Saudi Arabia tendered to buy 595,000 MT of optional origin wheat.
See ‘Policy Updates’ for late-breaking morning news updates... For updates to items in “First Thing Today” or any late-breaking morning news stories, check “Policy Updates” on www.profarmer.com.
Today’s reports
- 7:30 a.m. Weekly Export Sales — FAS
- 11:00 a.m. Cotton and Wool Outlook Tables: February 2025 — ERS
- 11:00 a.m. Feed Grains Database — ERS
- 11:00 a.m. Oil Crops Outlook: February 2025 — ERS
- 2:00 p.m. Feed Outlook: February 2025 — ERS
- 2:00 p.m. Rice Outlook: February 2025 — ERS
- 2:00 p.m. Wheat Outlook: February 2025 — ERS
- 2:00 p.m. Tree Nuts: World Markets and Trade — FAS
- 2:00 p.m. Slaughter Weekly — NASS