Corn
Price action: March corn fell a 1 1/4 cent to $4.93 1/4, closing nearer the session low.
Fundamental analysis: Corn futures faced midweek corrective selling after forging a new for-the-move high in overnight trade. The ag complex faced general selling after recent strength, despite a lower U.S. dollar index today, which was partially offset by crude oil’s downtrodden tone. However, solid technical support limited selling interest in corn, as did further evidence of lingering export demand with Mexico purchasing a flash 330,000 MT, as reported by USDA prior to the open this morning. Traders are also closely monitoring weather in central Brazil as safrinha corn plantings continue to be delayed.
Moreover, ethanol demand has remained rather robust, with the Energy Information Administration reported ethanol production averaged 1.112 million barrels per day (bpd) during the week ended Jan. 31, which was up 97,000 bpd (9.6%) from the previous week and 79,000 bpd (7.6%) above the same week last year. Ethanol stocks also increased 690,000 barrels to 26.412million barrels. That was the third largest weekly production on record and the highest stocks total since the week ended March 29, 2024. Moreover, the Renewable Fuels Association reported 2024 U.S. ethanol exports of 1.91 billion gallons topped the previous record, while DDG exports were the second highest ever.
Early tomorrow morning, USDA will release its weekly Export Sales Report, with traders expecting net sales to have ranged from 850,000 MT to 1.5 MMT during the week ended Jan. 30. Last week, net sales of 1.36 MMT were reported for the previous week, which were down 18% from the previous week but up 39% from the four-week average.
Technical analysis: March corn eased off the overnight and fresh near-term high of $4.98 1/2 during today’s session, though selling was limited by support at the 10-day moving average of $4.88 3/4. Bull’s still own the near-term technical advantage and will continue to seek a close above psychological resistance at $5.00, though today’s high will serve as resistance against those efforts. Meanwhile, bears will look to edge back below this week’s low of $4.72 1/2, though interim support lies at $4.90 then at Tuesday’s low of $4.87 1/4.
What to do: Get current with advised sales.
Hedgers: You should be 50% sold in the cash market on 2024-crop in the cash market.
You should also have 10% of expected 2025-crop production sold for harvest delivery.
Cash-only marketers: You should be 50% sold in the cash market on 2024-crop. You should also have 10% of expected 2025-crop production sold for harvest delivery.
Soybeans
Price action: March soybeans fell 18 cents to $10.57, nearer the daily low after hitting a four-month high early on. March soybean meal fell $5.70 to $308.30 and near the session low. March soybean oil fell 67 points to 45.09 cents, nearer the session low.
Fundamental analysis: Soybean and meal futures prices saw corrective pullbacks today following good gains scored earlier this week. Lower corn and wheat futures prices today also squelched the soy market bulls. Losses in the crude oil futures market today were also a bearish outside-market element for the soy complex.
World Weather Inc. today said rain “fell substantially overnight in portions of interior southern Argentina after a similar rain event occurred Monday night into Tuesday morning. The two waves of rain were the most significant seen since the first days in December.” Other areas in Cordoba have done relatively well with timely rain also, while the remainder of Argentina has had more dry and warm weather than beneficial moisture recently, raising concern over production. More rain is needed, though, since the growing season is only half over, said World Weather. In Brazil, scattered thunderstorms occurred Tuesday and overnight, disrupting fieldwork in some areas while others dried down a little bit. Weather in Brazil is expected to improve during the next 10 days, with less frequent and less significant rain allowing some of the wetter areas to slowly dry down.
Thursday morning’s weekly USDA export sales report is expected to show U.S. soybean sales of 300,000 MT to 1.1 MMT in the 2024-25 marketing year, and sales of zero to 50,000 MT in the 2025-26 marketing year.
Technical analysis: The soybean bulls have the overall near-term technical advantage. Prices are in a six-week-old uptrend on the daily bar chart. The next near-term upside technical objective for the soybean bulls is closing March prices above solid resistance at $11.00. The next downside price objective for the bears is closing prices below solid technical support at $10.20. First resistance is seen at today’s high of $10.79 3/4 and then at $10.90. First support is seen at Tuesday’s low of $10.48 1/4 and then at this week’s low of $10.31 3/4.
Soybean meal bulls and bears are on a level overall near-term technical playing field amid recent choppy trading. The next upside price objective for the meal bulls is to produce a close in March futures above solid technical resistance at the January high of $321.60. The next downside price objective for the bears is closing prices below solid technical support at the January low of $293.50. First resistance comes in at this week’s high of $314.90 and then at $319.00. First support is seen at $305.00 and then at $300.00.
Bean oil bulls have the slight overall near-term technical advantage. The next upside price objective for the bean oil bulls is closing March prices above solid technical resistance at this week’s high of 47.54 cents. Bean oil bears’ next downside technical price objective is closing prices below solid technical support at 42.00 cents. First resistance is seen at today’s high of 45.99 cents and then at 47.00 cents. First support is seen at this week’s low of 44.64 cents and then at 44.08 cents.
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 4 3/4 cents to $5.72 1/4, while March HRW wheat fell 3 cents to $5.91 3/4. March HRS futures fell 3 1/4 cents to $6.18 1/2. All three forged low-range closes.
Fundamental analysis: SRW wheat futures retreated from a near three-month high in early trade amid general selling across the ag complex despite extended U.S. dollar weakness. Earlier news China delayed imports of 600,000 MT of mostly Australian wheat, offering the cargoes to other buyers amid ample domestic supplies likely added some pressure to wheat today, though weather issues in Ukraine were also reported by the Ukrainian national agriculture academy. The group noted the country is experiencing the lowest soil moisture levels of the last seven seasons, raising concerns above 2025 yields. Scientists said the insufficient amount of precipitation during most of the winter period and very low reserves of moisture in the soil “cause special concern for grain producers.”
Early Thursday morning, USDA will release its weekly Export Sales Report, with analysts expecting net wheat sales to have ranged from 200,000 to 550,000 MT during the week ended Jan. 30. Last week, net sales of 456,100 MT were reported for the previous week, which were up noticeably from the previous week and up 96% from the four-week average.
Technical analysis: March SRW wheat extended to a fresh high, though resistance at $5.84 1/2, while support at $5.71 1/4 limited selling. Bulls continue to hold the near-term technical advantage and will continue to look toward holding a close above $6.00, while bears seek to breach support at $5.40. First resistance will serve at $5.85, while first support lies at $5.70 and again at $5.60.
What to Do: Get current with advised sales.
Hedgers: You should be 70% sold in the cash market for 2024 crop. You should have 20% forward sold for harvest delivery in 2025.
Cash-only marketers: You should be 70% sold for the 2024 crop. You should also be 20% sold for harvest delivery for expected 2025-crop.
Cotton
Price action: March cotton fell 90 points to 66.04 cents and near the daily low.
Fundamental analysis: The cotton futures market bulls petered out today after early-week gains. Lower grain futures prices and weaker crude oil prices today were bearish outside-market elements for cotton.
The next big event for cotton market traders is the National Cotton Council meeting Feb. 14-16, at which time new supply and demand estimates will be made by the council.
World Weather Inc. today said rain will be needed during the second half of winter and early spring in the southwestern U.S. desert region, southern California and both south and west Texas “to ensure favorable soil moisture for spring planting.” A few areas in the southeastern U.S. are still drier than usual and need rain as well. The U.S. Delta will be wettest for a while along with portions of the interior southeast. Some precipitation may impact west Texas next week, said the forecaster.
Thursday morning’s weekly USDA export sales report will be closely watched by cotton futures traders. Weekly U.S. exports of the fiber have backed off a bit the past couple weeks, but bulls point out U.S. cotton exports are still going out to many countries. Still, weekly U.S. export sales are falling behind last year’s export sales pace, which was nothing to write home about.
Technical analysis: The cotton futures bears have the solid overall near-term technical advantage. Prices are in a 4.5-month-old downtrend on the daily bar chart. The next upside price objective for the cotton bulls is to produce a close in March futures above technical resistance at 69.00 cents. The next downside price objective for the cotton bears is to close prices below solid technical support at 64.00 cents. First resistance is seen at 67.00 cents and then at today’s high of 67.31 cents. First support is seen at 65.50 cents and then at the contract low of 65.01 cents.
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.