Cash Grain Markets

casts for Argentina and Brazil make determining a firm direction difficult. However, the spread inverses on the board suggest the downside may be limited.

For the week, March corn rallied 6.75 cents to $6.83, July was up 2.25 cents at $6.65.75, and the December contract dropped 8.5 cents at $5.87.25 per bushel.

SOYBEANS — Soybeans gapped lower to begin the week; but by week’s end, those gaps were filled. Better short-term rains in Argentina put a damper on prices early in the week; but later extended maps had taken out some of the chances for moisture. The BAGE updated their Argentine soybean rating to 7 percent good/excellent compared to 3 percent last week and the poor/very poor category was 54 percent vs. 60 percent last week. Soybean planting was tagged at 98 percent complete. Safras put Brazil’s soybean harvest at 5 percent complete vs. 11 percent last year.

tinue meeting over Mexico’s plan to ban GMO corn imports beginning in 2025. The current stance to my understanding is the ban would only apply to corn meant for human consumption. Mexico’s deputy ag minister said this week they hope to cut total corn imports by 30-40 percent by 2024. With a 35 percent slash, it could mean a loss of 240 million bushels of U.S. corn exports to Mexico. Mexico is one of the largest U.S. corn customers accounting for 27 percent of total corn exports. They acknowledge they won’t be able to replace all the corn it imports by 2024.

The U.S. ag attaché in Beijing expects China will source a “substantial amount of its corn imports” from Brazil this year. Brazil’s corn is reportedly competitive with domestic corn and China has received its first shipment of Brazilian corn. The Buenos Aires Grain Exchange improved Argentina’s corn rating to 12 percent good/excellent from 5 percent last week and the poor/very poor rating went from 47 to 39 percent. They pegged corn planting at 94 percent complete which is spot on the average.

A little history of December corn prices: since 1994 the January high in the nearby current December corn contract was exceeded every year except for 2009 and 2013. The January high in December corn so far this month is $6.11 per bushel. Each year is different, so understand your situation if this doesn’t happen. Early forecasts for 2023-24 U.S. corn acres are centering around 90.5 million acres compared to 88.6 million planted acres in 2022-23. Assuming a trendline yield of 180.5 bushels per acre, production would be approximately 14.9 billion bushels vs. 13.93 billion bushels last year.

Outlook: The features dictating the direction of corn will continue to be South American weather and the demand pace for U.S. corn. The vacillating fore-

Weekly export sales were the highest in six weeks at 42.1 million bushels. This brings cumulative export sales to 1.7 billion bushels to maintain a 5 percent increase over last year. The USDA is predicting year-on-year exports to be down 8 percent this year. We need to average just 9.1 million bushels of sales per week to reach the USDA’s 1.99 billion bushel export outlook. So far this year, China has purchased 1.04 billion bushels of U.S. soybeans compared to 933.3 million bushels last year by this time in the marketing year. Cumulative soybean sales to unknown are a record at 169 million bushels for this date. Despite the fact China’s markets were on holiday for their Lunar New Year celebrations, the USDA this week announced the sale of 3.9 million bushels of sales to China for the 2023-24 marketing year and 11.8 million bushels of old crop to unknown. This was China’s first designated daily flash purchase of new crop soybeans of the year, but they purchased 2023-24 soybeans earlier that didn’t require a daily flash. Total new crop cumulative soybean sales are just 19.3 million bushels vs. 44 million bushels last year.

A look back at November soybean price action from January through November: the January high in the November contract has been exceeded every year since 1994 except for 1999. Every year poses its own set of circumstances, but this may help in your planning.

Outlook: Traders are hunched around their computers watching weather patterns across South America. Brazil’s soybean harvest is slower than last year due to moisture and they need to harvest beans in order to plant their safrinha corn crop. What China does when they return from their holiday will be interesting. Will more purchases be needed, and if yes, can they muddle through until Brazil’s soybeans are ready?

For now, old crop beans have moved into the upper