** 6:30 AM CST CBOT Prices: March soybeans are down 2.00 cents at $9.66, March corn is up .50 of a cent at $3.4875, and March Chi wheat is unchanged at $4.165.
** AgResource AM Grain & Oilseed Comment: Good Morning! It has been a mixed overnight CBOT trade with corn, soybeans and wheat trading either side of unchanged. The best overnight volume has been in March corn where just over 14,500 contracts have changed hands, with just over 4,000 contracts in March Chi wheat, and just over 6,000 contracts in March soybeans.
Tuesday’s CBOT open interest data shows an 18,301 contract gain in corn and a 10,458 contract gain in wheat, while soybeans declined 1,614 contracts. Funds are likely sitting on a record net short CBOT grain position.
The US dollar is slightly higher with the March index at 90.52 while spot crude oil is down $.30/barrel at $63.37. The US Stock market is back testing a new all-time high with US interest rates rising.
Localized areas of Southern Cordoba received better than expected rainfall overnight with some areas seeing amounts of 2-2.50”. The storm system is weakening this AM and most additional amounts will be less than .40” on coverage of no more than 20% of Argentina. The remainder of the country was dry. Lite showers were noted across N Brazil on Tuesday.
The Argentine weather forecast calls for limited rains over the next 10 days with cumulative rain totals for the period ranging from .25-.75”. The heat will be building from the south to the north with 90-95 degree readings returning later this week and throughout much of next week. Soil moisture levels will be in a decline and crop stress will return in early February.
A drier than normal weather pattern will persist across the northern half of Brazil as a high pressure Ridge prevails. The pattern will feature 20-40% of normal rainfall. High temps will range from the mid 80’s to the mid 90’s. The southern half of Brazil will see moderate to at times heavy rainfall. Totals look to range from 2-6.00” over the next 10 days with locally heavier amounts. A fast moving jet stream promises to continue the wet period into early February. Other than soy rust worry, S Brazilian crops will flourish.
Malaysian palmoil futures fell 32 ringgits to $2,483 RM/MT on the continued decline. Palmoil futures have been trading back and forth within a range for weeks as large stocks battle the seasonal decline in production.
Paris wheat futures are up $1.00 euro’s/MT at $155.50/MT as the selling spree slows and a reversal is forming on the charts. European wheat has to become more competitive if it has any chance of regaining export demand.
A fundamental supply trigger is needed to chase funds from their record short CBOT position. South American weather is far from perfect and crop size estimates are no longer growing, but the current weather pattern would have to be maintained beyond the next 10 days for traders to become “concerned”.
** 15 Day Percent of South American Rainfall — Not enough for Argentina and much of N Brazil
** 15 Day Total Precipitation for North America — Limited Totals in the Plains
