Good Morning!
I hope your week is going well so far. Around our place, we were wearing t-shirts on Friday and Saturday before the front moved in. With some snow and sub-zero temps on Monday and Tuesday, it’s been a bit of a shock. It’s supposed to be pushing 80° by Saturday, though, so once we dry out, I’m betting several will be socking some beans in the ground. If all goes well, we may plant beans next week, especially with what appears to be a clear forecast for the next couple of weeks. We had another 0.7 of rain with the front, but on the black ground, I’m assuming we’ll be fit within the next week, especially with it heating up. The speaking season is about to come to an end, and given that I’m ready to plant, it’s a good thing. It’s been a pleasure meeting so many of you in person this winter. I also appreciate those who have reached out and replied to the newsletter. Keep us posted on your spring, if possible. For more information on AgMarket, CLICK HERE. https://hubs.li/Q03qt2Qd0
The markets had a rough start to the week on Monday but settled down a bit on Tuesday. With May beans down the 70-cent limit on Monday, the small bounce on Tuesday wasn’t exactly a win, but at least we didn’t see follow-through selling. The war remains a factor, while U.S./Chinese relations continue to be closely watched. Outside markets should have provided a negative bias as crude continued to retreat:
CORN
The corn market started the week losing double-digits on Monday before a quiet tone emerged on Tuesday. May corn closed unchanged at $4.54. This was 5 off the high and 4 ¾ off the low. Corn export inspections were above expectations at 1.659 mmt. This was 100k+ over a week ago, as shipments continue to impress. On Monday, we lost 13 ¼ cents on May corn, but given May beans were locked down at the 70-cent limit, the performance from corn wasn’t as bad as it could have been. Last week, the funds bought a ton of corn, while the commercial was buying it off the grower and hedging it. Essentially, the funds bought the corn the grower was selling. It makes sense to see the grower selling after the price action of late, and given the basis weakening, I can only assume folks were putting in offers to catch one of these pops in the market before basis widens again. I think it’s wise to reward rallies, whether for old or new crop. On new crop, I want to maintain some flex, so some of our clients are buying calls or call-spreads, getting those in December or August short-dated, which expires July 24, after pollination. December 2026 corn settled 1 ¾ higher at $4.81 ¾.
SOYBEANS
Soybeans also moved lower on Sunday night and continued lower in the flurry of selling pm Tuesday. On Tuesday, May beans were up 1 ¾ at $11.57. This was 13 ½ off the high and 11 ¾ off the low. May soybean meal was down .5 at 311.7, while soy oil was up 2.03 at 65.97. Weekly inspections showed bean shipments at 996 kmt, which was above expectations again and above a week ago. The problem with this bean market is the sharp move lower on Monday. Even though crush came in on Monday at 208 mb, which was a new record for the month of February, the market dropped like a brick. With President Trump announcing over the weekend that his meeting with President Xi from China might be canceled, the trade was in panic mode. Fortunately, Trump announced there would still be a meeting, but it might not happen for another 5 or 6 weeks due to his needing to stay home while the US/Iran conflict is still heated. So, cash beans took it on the chin on Monday and didn’t get much back on Tuesday. However, Nov beans were down ‘only’ 40 ¾ on Monday while rallying 10 ½ on Tuesday. The new crop has had a better week so far, and my belief is the enthusiasm over renewable fuels is the reason they didn’t get worked over as bad. While beans have had a rough week so far, keep in mind how good these prices look versus what we’ve been staring at most of the winter.
Matt Bennett
mbennett@agmarket.net
815-665-0462
@chief321