Corn
Price action: March corn rose 1/2 cent to $4.98, closing near the session low.
Fundamental analysis: Corn futures notched slight gains despite solid outside market support, as traders pause after scoring solid gains in recent days. Psychological resistance at $5.00 continues to prove contentious for bulls, with a catalyst seemingly needed to propel buyer interest as a plunging U.S. dollar and crude oil strength failed to spur profound technical buying in the corn market today.
Global production continues to be of note, as safrinha corn-planting efforts remain behind normal, with a recent drier period coming to an end in Brazil’s center-west production areas. World Weather Inc. notes the area will trend wetter late this weekend and next week with more frequent showers and thunderstorms likely to slow farming activity. The forecaster states, “new delays in the late harvest of early soybeans and safrinha corn plantings are expected, which places pressure on producers to get the majority of the crops in the ground in the next few days.”
Earlier today, the International grains Council (IGC) reduced its global corn production forecast for 2024-25 by 3 MMT to 1.216 billion MT, though it remains slightly higher than USDA’s current projection of 1.212 billion.
Early Friday morning, USDA will release its weekly export sales data, delayed a day due to the observance of President’s Day on Monday. Analysts expect net sales to have ranged from 900,000 MT to 1.6 MMT during the week ended Feb. 13. Last week, net sales of 1.65 MMT were reported for the previous week.
Technical analysis: March corn futures carved a low-range close, failing to close above psychological resistance at $5.00 for the second straight session, though the previous session close of $4.97 1/2 served up support throughout the day. Bulls continue to grasp the near-term technical advantage and will continue to battle $5.00, with additional resistance layered at the previous session high of $5.04 1/2, then at $5.07 1/2 and $5.10 1/2. Meanwhile, support at the 10- and 20-day moving averages of $4.93 1/2 and $4.91 1/4 will continue to curb hefty selling.
What to do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Cash-only marketers: You should be 70% sold on 2024-crop. You should have 20% of expected 2025-crop production forward sold for harvest delivery.
Soybeans
Price action: March soybean futures rallied 13 3/4 cents to $10.45 1/2 and settled on session highs. March meal futures climbed $1.30 to $296.00, nearer session highs. March bean oil futures rose 96 points to 47.26 cents, near session highs.
Fundamental analysis: Soybean futures led strength across the grain and soy complex today, though ultimately continued in the tight range that has limited price action the past couple of weeks. Soybeans were supported by reports that a fresh trade deal with China is “possible,” according to President Trump. The potential willingness between the U.S. and China to avoid a trade dispute is bullish for raw commodities, as Washington is asking Beijing to increase purchases of American goods and to make large investments in the U.S.
Fieldwork is expected to continue at a healthy clip in Brazil, says World Weather Inc. while daily showers are expected, rain is expected to be light and poorly distributed, allowing activity to advance around rains. The second week of the outlook turns more wet, with Mato Grosso to Sao Paulo being the wettest, potentially slowing fieldwork.
USDA will release its weekly export sales report tomorrow morning, delayed a day due to Monday’s federal holiday. Analysts polled by Reuters showed expectations for sales between 100,000 and 500,000 MT for the week ended Feb. 13. Sales have been rather disappointing the past few weeks and expectations reflect that this week.
Technical analysis: March soybean futures posted strong gains and closed at the highest mark in over a week. Bulls maintain a slight advantage and are seeking to close prices above psychological $10.50 resistance before tackling resistance at $10.60 1/2. Support comes in at $10.40 1/2, the 10-day moving average, with further selling seeking to break prices below $10.33 1/2.
March meal futures continue to consolidate near recent lows as bears hold full control of the technical advantage. The 10-day moving average, currently at $297.20, has limited gains the past four sessions. Strength above that mark targets resistance at $300.00. Support comes in at $292.70 then the contract low of $285.10.
What to do: Get current with advised sales. Our next sales target is $11.00 in nearby futures.
Hedgers: You should be 55% sold in the cash market on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Cash-only marketers: You should be 55% sold on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Wheat
Price action: March SRW wheat fell 6 1/2 cents to $5.84 1/2 and nearer the daily low. March HRW wheat lost 6 1/4 cents to $6.07 1/2, nearer the daily low. March HRS fell 3/4 cent to $6.32 3/4.
Fundamental analysis: The wheat futures markets fell victim to profit-taking pressure by the speculators after recent price gains, and due to a risk-off trader mentality in the general marketplace today, as seen by a sell off in the U.S. stock market. Solid losses in the U.S. dollar index and higher crude oil prices were friendly outside-market elements for wheat futures today, but wheat traders appeared to mostly ignore them.
Wheat traders are closely monitoring weather conditions in major global wheat-growing regions. World Weather Inc. today said U.S. winter wheat crop damage this year “has likely occurred in many states from Montana to South Dakota into northern Texas, but it is quite unclear what the impact is going to be.” Meantime, no wheat crop damage occurred recently in Russia, Ukraine or western Kazakhstan since the coldest temperatures were in snow-covered areas. The same trend is expected most of this week, but there are some snow free areas nearby that could be damaged if temperatures get colder than expected. For now, winterkill is not very likely. Winter crops in most of Europe are dormant and no threatening cold is expected in snow-free areas, said the forecaster.
Weekly USDA U.S. wheat export sales data will be released Friday morning, delayed by one day due to the federal holiday on Monday. U.S. wheat export sales for the 2024-25 marketing year are expected from 300,000 to 600,000 MT, and sales of zero to 50,000 MT for the 2025-26 marketing year.
Technical analysis: Winter wheat market bulls still have the overall near-term technical advantage. Prices are in uptrends on the daily bar charts. SRW bulls’ next upside price objective is closing March prices above solid chart resistance at this week’s high of $6.09. The bears’ next downside objective is closing prices below solid technical support at $5.60. First resistance is seen at today’s high of $5.95 1/2 and then at $6.00. First support is seen at $5.80 and then at last week’s low of $5.71 1/2.
The HRW bulls next upside price objective is closing March prices above solid chart resistance at the October 2024 high of $6.38 1/4. The bears’ next downside objective is closing prices below solid technical support at $5.80. First resistance is seen at today’s high of $6.21 and then at this week’s high of $6.30 1/2. First support is seen at $6.00 and then at last week’s low of $5.87 3/4.
What to Do: Get current with advised sales.
Hedgers: You should be 85% sold in the cash market on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 85% sold on 2024-crop. You should have 20% forward sold for harvest delivery in 2025.
Cotton
Price action: March cotton futures settled 27 points lower to 65.97 cents, near mid-range.
Fundamental analysis: Cotton futures continued lower today as prices look to challenge contract lows made earlier this month. Yesterday’s break lower can be attributed to certified stocks jumping to 1,732 bales, the first new cert stocks since Dec. 12. As cotton prices continue lower, a lot of attention will be paid on exports to watch out for any uptick in demand. As prices continue lower, it is reasonable to think that at some point prices will be “cheap enough” and lead to increased bookings from importers. Given how short funds are, a bullish catalyst could lead to funds covering some of their shorts, the most likely source of any upcoming rally as bullish new-crop fundamentals did little to spur strength. The U.S. dollar index fell to fresh for-the-move lows today. The weakness in cotton futures despite a weaker dollar is particularly concerning, a testament that despite relatively cheaper prices, importers are not actively advancing purchases.
Technical analysis: March cotton futures closed lower for the second straight session as bears maintain the technical advantage. Prices settled near support at 66.00 cents, while weakness below that mark has bears targeting support at 65.63 cents, then 65.01 cents, the contract low. Bulls are eyeing resistance at 66.69 cents then 67.51 cents, the 40-day moving average, on resurgent strength.
What to do: Get current with advised sales and hedges.
Hedgers: You should be 35% sold in the cash market on 2024-crop.
Cash-only marketers: You should be 35% sold on 2024-crop.