Corn
Price action: March corn futures rose 5 3/4 cents to $4.90, at the session high and hit a seven-month high.
Fundamental analysis: The corn futures bulls are keeping their pedal to the metal, with technical buying featured amid South American weather concerns and a plunging U.S. dollar index to start the holiday-shortened trading week. Solid gains in soybean and wheat futures markets today also supported buying interest in corn.
The grain markets are also breathing a sigh of relief, at least temporarily, that President Donald Trump postponed imposing new trade tariffs and directed federal agencies to review trade relationships with China, Canada, and Mexico. The Trump administration now favors a methodical approach on the matter, reports said.
Brazil’s safrinha corn planting was only 0.3% complete as of last Thursday, according to AgRural--the slowest start since 2021. World Weather Inc. today said rain in the middle two-thirds of Argentina during the weekend occurred as expected and should bring some needed relief to recent heat and dryness, “although much more rain is still needed.” Brazil crop areas will experience a good mix of rain and sunshine during the next two weeks, benefiting some full-season and late-season crop development, said the forecaster. Pro Farmer’s South American crop consultant, Michael Cordonnier, cut his Argentine corn crop estimate by 1 MMT, to 48 MMT, noting a lower bias going forward. Cordonnier kept his Brazilian corn crop forecast unchanged at 125 MMT.
USDA reported solid weekly U.S. corn export inspections of 1.541 MMT, up 99,171 MT from the previous week and above pre-report expectations.
Technical analysis: The corn futures bulls have the solid overall near-term technical advantage. A seven-week-old price uptrend is in place on the daily bar chart. The next upside price objective for the bulls is to close March prices above solid chart resistance at $5.00. The next downside target for the bears is closing prices below chart support at $4.70. First resistance is seen at today’s high of $4.90 1/2 and then at $4.95. First support is seen at today’s low of $4.82 1/2 and then at $4.80.
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 surged 33 1/4 cents to $10.67 1/4, marking a 15-week high close. March soymeal rallied $13.80 to $311.00, notching a close above the 100-day moving average. March soyoil rose 8 points to 45.77 cents.
Fundamental analysis: Soybeans extended Friday’s gains amid lingering South American weather concerns and strong support from a plunging U.S. dollar, which retreated following President Trump’s announcement that new tariffs will be postponed. However, he directed federal agencies to review trade relationships with China, Canada and Mexico, with trade officials assessing trade deficits, unfair practices and currency issues.
Meanwhile, in Brazil harvest efforts continue to progress at the slowest pace since 2020-21, with only 1.7% of the crop harvested as of last Thursday, according to AgRural. Meanwhile, harvest in Mato Grosso, the country’s top producing state, was the slowest in AgRural’s historical series, which began in 2010-11. World Weather Inc. notes most of Brazil, outside of some northeastern areas, will continue to see frequent rounds of showers and thunderstorms through the next two weeks, slowing fieldwork—especially from Mato Grosso to Sao Paulo and western and southern Minas Gerais, where rain will be the greatest. Meanwhile, in Argentina, rain over the next two weeks will be welcome and help crops cope with lighter than usual rainfall and warm temps. However, some areas will continue to experience too much drying and crops will be stressed.
As such, South American crop consultant Dr. Michael Cordonnier lowered his Argentine soybean forecast by 1 MMT to 51 MMT but left his Brazilian estimate unchanged 170 MMT.
Earlier this morning, USDA reported weekly export inspections of 973,145 MT (35.8 million bu.), down from 1.357 MMT from the previous week and below expectations from 1.25 MMT to 1.6 MMT.
Technical analysis: March soybean bulls managed to close at the highest level since Oct. 7, though resistance at the 200-day moving average of $10.77 1/2 could crimp a followthrough move. Meanwhile, however, initial support will now serve at $10.50 1/2, then at $10.42 1/4, which is backed by the 10-, 100- and 20-day moving averages, currently trading at $10.30 1/4, $10.21 1/4 and $10.11 1/2. Bulls will continue to look towards breaching the 200-day and moving above $11.00, while bears will look to edge below psychological support at $10.00, and the Dec. 19 low of $9.47.
March soymeal gapped higher in overnight trade, and ultimately finished the day session above the 100-day moving average of $310.30. Resistance will now stand at the Jan. 2 high of $321.60, then at the 200-day moving average of $327.90, while initial support will now serve at the 100-day moving average. Further support will lie at the 20-, 10- and 40-day moving averages of $305.60, $302.00 and $300.40.
What to do: Get current with advised sales.
Hedgers: You should be 40% priced in the cash market on 2024-crop production.
Cash-only marketers: You should be 40% priced on 2024-crop production.
Wheat
Price action: March SRW futures surged 20 cents to $5.58 3/4 and closed on session highs. March HRW futures closed 27 cents higher to $5.75 1/2, a more-than two-month high close.
Fundamental analysis: Wheat futures saw persistent buying overnight and buying efforts accelerated on this morning’s open, scoring a technical breakout on the daily bar chart. Reports of frigid temps in the winter wheat belt provided fundamental support as two-thirds of the Plains saw cold enough readings to likely induce some winter-kill as the area lacked insufficient snow-cover. While that likely hinders production, the full effects of the piercing cold will not be known until springtime. Wheat prices were also supported by a weaker dollar today. The dollar index was down nearly 1,500 points in the first day of trading following Trump’s inauguration as is threatening to break the uptrend seen since the September low. A weaker dollar would make U.S. crops more competitive on the world export market. The counterpoint to that claim would be any hindrance to U.S. supplies due to trade barriers, as President Trump has promised to enact tariffs on various countries as early as Feb. 1. Today’s rally could point to overly-pessimistic price action ahead of the inauguration and possibly some optimism that Trump’s tough-on-trade view will have a positive impact on agricultural outflows as he holds nations to current standing trade deals, such as the Phase 1 agreement with China.
USDA reported weekly export inspections of 261,786 MT (9.6 million bu.), down from 299,191 MT the previous week and below expectations of 300,000 to 500,000 MT. That is below the pace needed to hit the current USDA export estimate. Accumulated inspections so far this year are running well below what is historically needed to hit the USDA estimate as well. Inspections tend to rise seasonally into the end of the marketing year, so today’s weak figure was rather disappointing.
Technical analysis: Winter wheat futures’ bull notched a bullish breakout on the daily bar chart today as prices surged to the highest mark in over a month. SRW bulls are looking to build on today’s gains to avoid a false breakout, reversal, which would likely have traders looking to challenge the Jan. 10 contract low at $5.26. Additional support lies at $5.43 3/4 on the way, though bulls are ultimately trying to keep prices above $5.50. Additional strength looks to overcome resistance at $5.69 1/4, the Dec. 11 high, which is closely backed by the 100-day moving average at $5.70.
March HRW futures saw a similar technical breakout today on the daily bar chart. Bulls are looking to overcome 100-day moving average resistance at $5.75 on continued strength. Above that mark, bulls are looking to overcome resistance at $5.89. Meanwhile, support comes in at $5.68 1/2 then the 40-day moving average at $5.58 on a reversal lower.
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 rose 6 points to 67.66 cents, but closed nearer the session low.
Fundamental analysis: A tumbling U.S. dollar and rallying equities did little to excite cotton futures to begin the week as crude oil futures spiraled lower, retreating further from last week’s high. Meanwhile, technical headwinds and bearish-leaning supply/demand fundamentals continue to curb short-covering interest.
In South America, northern Argentina cotton areas will receive some showers over the coming week with a much better chance for rain during the last week of this month, though crop conditions should be mostly good. In Brazil, planting progress in Bahia was 72% complete as of Jan. 12 and 18.5% complete in Mato Grosso. Progress in the two states was a little behind last year’s. World Weather Inc. notes weather conditions may have been a little more supportive of planting during the weekend, although early season soybeans must be harvested before planting can advance.
Technical analysis: March cotton failed a test of the 10- and 20-day moving averages, currently trading at 67.71 cents and 68.14 cents, though support at 67.29 cents held throughout the session. Nonetheless, cotton bears continue to firmly grasp the near-term technical advantage, with sights set on a close below 66.00 cents, with interim support serving at 66.96 cents, again at last week’s low of 66.60 cents. Meanwhile, in order for bulls to regain technical traction, they will need to secure a close above the 40-day moving average of 69.23 cents, which is backed by psychological resistance at 70.00 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.