** AgResource Pre Opening Holiday Market Calls: Soybeans 4-6 cents higher, corn 1-2 cents higher with wheat called 2 cents higher to 1 cent lower.
** Monday Weather & Market Comment Discussion: CBOT opening week calls are mixed to mostly higher. The long holiday weekend proved disappointing for rains across Argentina and S Brazil and the markets are likely to quickly add some additional weather premium back into price. Notice in the January 10-14th time frame, only 17% of Argentine crop areas enjoyed rain totals over 1.00”! Sure there were some lucky areas that received more than 2.00”, but this was not the rain event that was going to end a budding 4 month drought. Crop potential will continue to decline across Argentina without soaking rainfall in the coming weeks.
** January 10-14th Rainfall Across Argentina and S Brazilian Crop Areas:
Friday’s CoT report showed that the managed money is; short 129,000 contracts of Chi wheat (up 1,000), short 222,000 corn (up 23,000), short 93,000 contracts of soybeans (up 8,000), long 12,000 contracts of soyoil (9,000), and long 16,000 contracts of soymeal (down 2,000 contracts). The combined managed net short position of corn, soy & wheat is a cumulative 414,000 contracts, which is above market expectations and offers upside market risk.
The USD is lower with the index breaking out to the downside and perched against support at 90.00. The Brazilian real at 3.19:1, the Argentine Peso at 18.6:1, and the Russian Ruble at 56.5:1 are all firmer. Even the Chinese yuan has scored a multiyear high at 6.43:1 USD. The falling USD is supportive to commodities with the CRB index expected to score a new rally highs this week.
Malaysian palmoil futures closed higher on Monday with the March contract at 2,555 RM/MT, up 19 ringgits. Paris wheat is off $1.00 euro/MT at $156.25 while China’s Dalian corn rose and soymeal closed mixed.
** South American Weather Pattern Discussion: The US and EU weather models are in fair agreement. The black circles on the 10 day EU model precipitation map highlight areas of limited rain and expanding dryness. Unusual is the dryness across N Brazil, as January is normally one of the wettest periods of the year! And heat will be building across N Brazil due to a high pressure Ridge. The 2017/18 Brazilian soybean crop was late seeded, and some stress is expected.
Argentine crop areas will also endure limited rain, but temps will be seasonal early in the 10 day forecast, and then warm to above normal levels. The lack of moisture is becoming more concerning for soy and corn yield potential.
Sandwiched in-between the aforementioned dry areas is the location of the jet stream where frequent and heavy rains will fall across the southern third of Brazil. Crops here should preform nicely.
**10 Day EU Model Rainfall Forecast: Not Enough Rain for N Brazilian and Argentine Crops
**1-15 day Temperature Anomaly: Warm across N Brazil with Heat Returning to Argentina:
