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Corn Outlook:
We are entering the holiday season which means volume and interest in the grains will fade as traders wind down their trading for the year. However, because of lighter volume, price swings can be exaggerated for no apparent reason. Meanwhile, looking at corn, it does not have much of a story as ending stocks of 2.1 BB are the highest since 2018, while exports remain sluggish. Last week, inspections were modest at 21.8 MB and must average 44.0 MB weekly to reach USDA’s target of 2.075 BB. The average shipment in the past four weeks has been 21.9 MB, which is 4.3 percent below the five-year average of 22.9 MB. The bottom line in corn is that it is carrying too much baggage to whet bullish interest.
Bean Outlook
Weather in Brazil continues to entice the bulls, and that may continue a while longer. Showers developed in the central region last weekend, but it did not deter their interest. Expectations are their production will be lowered with one source putting it at 158 million tons. However, even at that, it would tie last year’s record. Meanwhile, our exports show signs of peaking. Last week, inspections fell below the previous week to 59.1 MB with China taking 36.9 MB of the shipments. Since the first week of November, the export pace has fallen 14.1 percent with shipments to China declining 24.5 percent. The average shipment in the past four weeks has been 66.6 MB, which is 10.2 percent below the five-year average of 74.2 MB. The point taken is that while weather in Brazil is the focus for now, when it passes, exports will have to shoulder the load.
Wheat Outlook:
Wheat values sank to a new low this week as positive news is scarce. Ending stocks are rising, Russia remains a thorn in our side, and exports are lethargic at best. Last week, inspections of 13.1 MB were the highest since early October but were still below the average of 14.7 MB that must be shipped each week to reach USDA’s target of 700 MB. The average shipment in the past four weeks has been 7.9 MB, which is 23.1 MB below the five-year average of 9.8 MB. In other developments, the rating of the winter wheat crop improved one-point last week to 48 percent in good-to-excellent condition and compares to last year’s rating of 32 percent. The bottom line in wheat is the funds are short, but there is little to shake their resolve.
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