#Argentina's grain belt in 2023 had its wettest December since 2009, receiving 2.5x more rain than in Dec 2022. Nov-Dec rainfall was 33% above average.As of last week, only 1% of #corn and 3% of #soybeans were in bad health vs 27% and 30% a year ago, respectively.
CBOT #soybeans have tumbled 4% so far in 2024 - beans' worst start to a year in exactly 40 years. Monday's low of $12.36/bu is the most-active contract's lowest since Dec. 2021. Beans are now in oversold territory per the relative strength index.
Soybean weather here:
South America Wx and crops
63 responses |
Money managers have posted a record-fast selloff in CBOT #soymeal futures & options since late 2023 (chart through Jan. 2). Meal futures are more than 20% off their mid-Nov peak, unusually steep losses, particularly for this time of year.
SCROLL DOWN FOR THE ENTIRE 1-12-24 USDA REPORT!
Analysts see USDA cutting production for #Brazil's #soybeans by nearly 5 mmt on Friday, and #corn is seen down close to 4 mmt. #Argentina's crops are seen near steady to a little higher than last month.
The trade sees yield for 2023 U.S. #corn & #soybeans unchanged from prior estimates with slightly smaller output based on thinner area. This report is almost always more exciting than these expectations but not necessarily market-impacting exciting. Lots of data coming Friday.
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Analysts expect that Dec. 1, 2023 U.S. #corn stocks were the date's highest since 2018, up 11% on the year. #Soybeans would be the date's smallest since 2020, down 1.5% from Dec. 1 last year and #wheat the largest since 2020, up nearly 6% from last year.
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Conab cut #Brazil's 2023/24 harvest of #soybeans by nearly 5 mmt from last month due to dry weather in key areas. #Corn crop was also trimmed (though heavily exported 2nd crop was unch). Corn exports were reduced citing big U.S. supplies and old-crop bean exports rose ~2 mmt.
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Get ready for some price fireworks at 11 am CST on Friday(1-12-24)!
The report was pretty bearish, based on market reaction. more after I return to my office.
2023 U.S. #corn production comes in above expectations on a huge boost to yield. #Soybeans are also above expectations.
The massive increase in 2023 U.S. #corn yield was tempered by a sizable cut in harvested acres (which came in below all trade estimates). Harvested acres for #soybeans came in at the low end of expectations, also limiting the larger yield's effect on production.
Harvested #corn acres came in just below the lowest trade estimate. Unsure what exactly happened in Pennsylvania.
U.S. #corn yield was a record 177.3 bu/acre in 2023, up sharply from the previous estimate and above all trade estimates (biggest upside Jan yield shock since 2009). Many top states saw sizable upward revisions from November. Indiana's record 203 tops Iowa, Ohio just shy of 200
Harvested acres were at the low end of expectations for U.S. #soybeans, though there were very minor changes in the top states. A huge cut in Kansas is not surprising given the excessively dry finish to their season.
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Yield for U.S. #soybeans in 2023 landed above all trade estimates at 50.6 bu/acre, a two-year high but below trend. A bump in top producer Illinois anchored the yield increase from November.
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The outcome of U.S. corn/soybean production may have seemed shocking, but it was within historical limits. Trade guesses were less than 1% too light on both. Before Friday, the last truly bearish January outcomes were for 2019 and 2012 (in January 2020 and 2013).
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CBOT #corn finishes down 2.3% on Friday, hitting new contract lows as USDA pegged the U.S. crop well above trade expectations. This was corn futures' worst January report-day performance in 12 years.
Trends are made to be broken? Most-active CBOT #soybeans fell 1% on Friday (after being down as much as 2.7%) as USDA projected U.S. and global soy supplies above expectations. That marked the first time in 9 years that beans finished lower off of USDA's January data dump.
U.S. December 1 grain stocks all in above expectations.
U.S. #wheat stocks come in below expectations and #corn and #soybeans land above (but well within the expected range) on bigger 2023 harvests. No change to exports all around.
#Brazil #soybeans down from last month but by slightly less than trade expected, #Argentina soy crop up 2 mmt. Argy #corn unch, Brazil corn down but by less than expected.
Funds haven't been interested in selling CBOT #wheat futures and options since November, and their net short as of Jan. 9 (58k contracts) is nearly identical to a year ago. Also, safe to say specs are suuuper bearish K.C. and Minneapolis wheat.
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Money managers spent *almost* 4 entire years as soybean bulls - no more. As of Jan. 9, their net short in CBOT #soybeans (31,248 fut+opt contracts) was the largest since March 3, 2020, just before the pandemic hit.
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Money managers padded their short bets in CBOT #corn futures & options ahead of Friday's USDA report (which turned out bearish). As of Jan. 9, the managed money net short stood at 230,723 contracts, the largest since June 2020.
Crop progress, Parana, #Brazil, Jan. 15: #Soybeans 64% good condition, was 71% last week and 86% at the month's start. Beans are 7% harvested, 1st crop #corn 5% harv, 2nd corn 4% planted. 1st corn 73% good condition (80% at month's start).
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Farmer lobby in #Brazil says production estimates on 2023/24 #soybeans are too high by as much as 20 mmt.
#Ukraine's 2023/24 grain exports are down 17% from last year as of Wednesday (versus about -25% as of late Nov/early Dec). But shipments have picked up in January, and the month's total so far is ahead of Jan 2023's pace.
Soy yields in #Brazil's Mato Grosso may be the worst relative to trend in 15+ years. This analytics firm is putting the state's #soybeans at 15% below trend, a very big deviation for MT. For comparison, yields in Parana & RG do Sul were more than 40% below trend in 2022.
But don't interpret this to be minimizing MT's losses. Conab shows MT farmers for the 2024 harvest planted 12.2M ha (30.2M acres) of #soybeans. Area in PR + RS is only very slightly larger than that at 12.5M ha (30.8M acres).
This is a super basic map from Wikipedia that can help if you're not overly familiar with Brazilian geography:
Helpful chart to understand the distribution of total #corn production in #Brazil (as estimated by Conab for 2023/24). 1st crop is set to account for 21% of total output, 78% 2nd crop & 2% 3rd. Mato Grosso's 2nd crop is seen accounting for 38% of Brazil's full corn harvest.
Jan. 17: New-crop CBOT December #corn falls to $4.75 per bushel, a 2+ year low. Dec24 corn chopped around the last five months of 2023, but it's lost nearly 6% so far in 2024.Dec futures on the comparable date in recent years: 23- $6.01 22- $5.65 21- $4.49
CBOT #soymeal futures are trending in the complete opposite direction versus the last three years. During the final couple months before expiry, the 2020 March contract was among the lowest of the decade+ and 2023 was the highest.
Good crop prospects for Argentina this year plays a role in this trend, as it has been a few years since the top meal exporter has had a solid yield outcome for soybeans.
Strong U.S. export sales last week with #corn & #wheat above all expectations and #soybeans & #soymeal at the high end. Philippines led sales in wheat & meal, Mexico showed up big in corn. Large bean volume was switched to China from unknown, Germany was in for 219kt beans.
After two holiday weeks of light (but seasonally normal) sales, this rebound is exactly what we needed to see this week to stay within the realm of overall export expectations.
USDA confirms the sale of 297,000 tonnes of U.S. #soybeans for delivery to #China in 2023/24.
#China imported nearly 5 million tonnes of #corn in December, bringing total 2023 corn imports above 27 mmt, up 32% on the year. #Wheat imports were up 22% and #barley nearly double the 2022 levels. #Soybeans were up 11% though #sorghum imports sunk nearly 50% from last year.
Analysts expect Malaysian palm oil futures to rise 4% in 2024 (to 3,950 ringgit/$838 per tonne). The biggest price influencers will be Indonesia's B35 biodiesel mandate implementation and an increase in supplies of rival vegoils, esp. soyoil with soy output rising in S. America.
