Corn Leads Grain Rally Fueled by Bullish Weather -- Daily Grain Highlights
By Paulo Trevisani
--Corn for March delivery rose 1.7% to $6.36 a bushel on the
Chicago Board of Trade Friday on forecasts for dry weather in
growing regions of South America.
--Soybeans for March delivery rose 1.5% to $14.70 a bushel.
--Wheat for March delivery rose 1.2% to $7.86 1/2 a bushel.
Weather Premium: Weather remained a key discussion point on the
supply side Friday, as dry conditions hurt yields in South America.
"The weather forecasts are incrementally drier this morning, with
little moisture seen over the next ten days for the southern tip of
Brazil, or for most of the Argentine corn areas," ED&F Man
Capital's Charlie Sernatinger said. There were also "a lot of
traders talking about how the exports are starting to pick up, and
how the ethanol grind has been robust, as well as animal feeding,"
Mr. Sernatinger added.
China Bean Buy: The USDA this morning reported a new flash sale
of soybean exports to China, with 264,000 metric tons being sold
for delivery in the 2022/23 marketing year. Additionally, 141,514
tons of soybeans were sold to Mexico for delivery in the 2021/22
marketing year. The new flash sales come after the USDA reported
Thursday that for the week ended January 20, soybean sales totaled
1.23 million metric tons across the 2021/22 and 2022/23 marketing
years, with China being the primary buyer. This was up from the
week before, but fell below the forecasts of grain traders surveyed
by The Wall Street Journal.
Russian Inflation: Russia is expected to continue to use quotas
and taxes to keep supplies of grains in the country, boosting wheat
prices, StoneX's John Payne says. That would be in reaction to
rising inflation, which is pushing the Russian central bank to
raise rates. On corn, Payne says that "there remains hope for a
decent second corn crop from Brazil as well as a good crop for
Argentina, but rains need to develop in E. Argentina."
Oil Rally: As soybean futures climbed today, AgResource said a
sharp increase in palm oil prices was fueling demand for soy oil.
That, in turn, provided extra support for the grain at a time when
South American production is being constrained by adverse weather.
AgResource said that Indonesia, the world's largest palm oil
exporter, "has moved to raise domestic supplies, boost domestic
biodiesel production and cap exports."
Skimpy Soybeans: The outlook for South American soybeans
continued to be for a smaller crop--which has pushed CBOT soybean
futures up to their highest level since July, at over $14.66 per
bushel. "The soybean market is telling us that it believes that the
South American crop is much smaller than what is currently being
published," says Arlan Suderman of StoneX. "That's seen in the
futures market, which seems bent on pursuing higher chart
objectives." The price has further room on the upside, Suderman
adds. "Bids for summer Brazil loadings are now more expensive than
US bids. That suggests that the cash market believes that China
will need to come back to the United States for supplies by
-The USDA will release its weekly grains export inspections
report at 11 a.m. ET Monday.
-The USDA will release its monthly grain crushings report at 3
p.m. ET Tuesday.
--The EIA will release its weekly ethanol production and stocks
report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30
a.m. ET Thursday.
-Corteva Inc. will release its fourth-quarter earnings before
the stock market opens Thursday.
--The CFTC will release its weekly commitment of traders report
at 3:30 p.m. ET Friday.
Kirk Maltais contributed to this article.
Write to Paulo Trevisani at email@example.com
(END) Dow Jones Newswires
January 28, 2022 15:30 ET (20:30 GMT)
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