On The Money Grain Commentary 2-23-23

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Corn Outlook:

Light frost occurred over President’s Day weekend in Argentina but had little bearing on corn values. Meanwhile, exports face a dilemma. Although inspections were higher than expected last week at 24.5 MB, they must average 49.4 MB on a weekly basis to reach USDA’s target of 1.925 BB. As it looks now, that is not going to happen. Since the end of December, the pace of shipments has fallen 22.6 percent. Furthermore, China was a no show for the third straight week. In the meantime, Brazil has overtaken the U.S. as the world’s largest exporter of corn. The bottom line is that corn needs positive input but may not see any unless there is a weather threat in the Midwest this spring.

Bean Outlook:

The light frost that developed in Argentina over the past weekend gave soybeans a brief lift. However, expectations for a record crop in Brazil will likely overcome any shortfall. Meanwhile, exports are slipping. Last week, inspections were slightly below the previous week at 57.9 MB. China took 37.0 MB. However, this was the second consecutive week that the pace of shipments to them has declined. As mentioned in previous comments, relations with China are tense and their primary source for soybeans will be Brazil.

Wheat Outlook:

Concerns of a possible disruption of wheat shipments from the Black Sea Region appear to be wearing off as Russia is forecast to produce a record crop in addition to record exports. In a recent tender to Egypt, Russia had the cheapest offer. Meanwhile, the forecast for moisture in the Midwest and southern Plains this week is offering resistance. Looking at exports, they are mostly run of the mill with inspections last week at 13.7 MB. This was slightly below the average of 14.7 MB that must be shipped on a weekly basis to reach USDA’s target of 775 MB. Currently, the pace of shipments is on track to meet their projection.

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