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Corn Outlook:
Corn began the week in the red but has stabilized ahead of the January Crop Report that is due at the end of this week. However, it will continue to meet a headwind from improving conditions in Brazil and abundant stocks. Exports are improving but have a long way to go. Inspections last week exceeded the previous week at 33.7 MB but were well below the average of 46.9 MB that must be shipped weekly to meet USDA’s target of 2.1 BB. The largest shipment so far this marketing year is 45.5 MB, which means reaching their projection will be a challenge. Looking in the weeks ahead, the focus in corn will be on planting estimates and the spring weather outlook.
Bean Outlook
Soybeans have run into a buzz saw as improving weather in Brazil is easing concerns about production. However, chances are that it will likely be lowered from USDA’s current estimate of 161.0 million tons. As mentioned in previous comments, once the focus on weather has passed, exports will have to carry the ball. However, that will be a challenge. Last week, inspections were 24.7 MB, the smallest shipment since the first week of October. Meanwhile, since peaking in early November, the pace has fallen 51.0 percent while shipments to China have declined 76.4 percent. The bottom line is that if more acres are planted this spring, as expected, soybeans will have a long road ahead of them.
Wheat Outlook:
Wheat has been resilient considering the decline in corn and soybeans. Recent snowfall and moisture in the southern Plains is alleviating concerns of dryness, but increased tensions and escalation of activity in the Red and Black Sea regions are offering support. Meanwhile, exports are improving with inspections last week, the second highest of the marketing year at 18.0 MB. While this is encouraging, we must ship 16.8 MB each week to meet USDA’s projection of 725 MB which will be a challenge.
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