Weekly Crop Commentary - 02/7/2025
Feb 07, 2025
Wes Bahan
Vice President, Grain Division
Good afternoon once again. Wildcards seem to be the theme these days. Tariffs, weather, exports, domestic crush margins. Everything just seems to have a wildcard out there to be played. We came into Sunday night with markets sharply lower on tariffs being put in place on Mexico, Canada, and China. Then by midday Monday those were cancelled and the market rebounded.
The weather in Argentina is getting attention and rightfully so. The corn and bean crops there have seen ratings fall drastically in the past month. Sounds like they are past the point of no return even if rains were to begin now. Will we see a decrease in the size of the Argentine crops in next week's monthly update?
In this week’s export sales report, we did see another big week of corn sales. 58 million bushels which is well ahead of the 10-week average of 46 million bushels. This puts us at 72% of the USDA estimate already sold. Historically we are 65% sold, and the high was 80% back in the 20/21 marketing year. Soybean sales continue to fall off, which they should for this time of the year. Fourteen million bushels on the report yesterday is well below the 10-week avg of 41.8 million. That average will be coming down each week now. Brazilian beans are beginning to hit the marketplace. With that being said, we still have 87% of the USDA estimate sold, compared to the 5-year average of 82%.
Domestic crushing margins for corn have continued to improve this week. The ethanol producers are back in the black and they picked up the pace by producing 97,000 barrels more per day than the prior week. Stocks were also on the rise, coming in at just under 26.5 million barrels. Soybean crush margins continue to struggle as the backlog of meal is hampering them. Argentina exports a lot of meal, so maybe just maybe, we can fill that void and get some of this meal on the move.
We are at 15-month highs for both corn and beans, the funds have switched attitudes, and we are quietly continuing to feed the bull to keep things going. It sounds like we have another round of ice coming tomorrow afternoon/evening so make sure you rush out to get that bread and milk. Have a great weekend.
Lou Baughman
Grain Merchandiser, Kenton (Region 1)
The last couple of weeks we have seen grain deliveries pick up with the movement in the markets. Markets have been choppier this week and seem satisfied in the range that they are in. Tuesday will be the crop report; February usually doesn’t have many surprises. The one we all watch for is Prospective Plantings at the end of March. I watched BAM Weather yesterday and they think February is going to be an active month for storms. It sounds like there will be a large one around the 25th, so don’t plan on putting away your winter clothes for a while.
Briana Holtzman
Grain Merchandiser, Upper Sandusky (Region 2)
It would appear that President Trump’s tariff threats have worked in the way that he anticipated them to with Mexico and Canada. The threat of these tariffs has allowed agreements to be made between the US and these countries to increase border security and decrease the flow of illegal substances into the U.S. The tariff threats on these countries by the U.S. have been pushed to March 1, allowing more time for negotiations to be made. There is still a lot of work to be done between China and the U.S. in terms of tariff negotiations, and grains were not on the list of possible tariffs between these two. The markets reacted very well to this news and rallied early this week.
We are ending the week down, as Brazil saw strong rains with good coverage, and we saw profit-taking from the funds. Next week, on Tuesday, is the February WASDE Supply and Demand report, but it is predicted to be uneventful.
Steve Bricher
Grain Operation Manager, Urbana (Region 3)
It is Superbowl weekend! I know every bar and pizza joint will be hopping. My wife asked me the other night who I was rooting for, and I told her I don’t have a good answer. These types of games I usually start watching and then figure out who I want to win. I just know my Bengals are not there, so I really do not have a dog in the fight.
This has been a wild week for the markets with everything going on in Washington. This is going to be normal for a while as the new administration gets rolling.
The markets seem to be reaching a top at this point. There isn’t a strong reason for them to push much higher, but investment funds have shifted from being short on corn last year to now taking long positions. If, at some point they decide to get out, how far back can we chase these markets? I have been telling customers for the last two months to continue to sell into the rally. I believe in rewarding a market that is improving and not trying to pick a top. At the end of the day, it is about an average and not just one sale.
Lisa Warne
Grain Merchandiser, Marysville (Region 4)
Welcome to Super Bowl weekend! I guess I’ll cheer for the Eagles since the Bengals let me down again this year. In the grain markets this week, wheat was the big winner. The July wheat futures were up nearly 4%, over 20¢, to levels we haven’t seen since October. Extended forecasts for extreme cold in the Black Sea region have traders concerned about crop damage in a wheat crop that already had a less-than-ideal start. Here in the U.S., some hard red winter wheat areas also have colder extended forecasts and continued dryness showing on the drought monitor. Keep an eye out later this month for enrollment details on our wheat average price contract.
Corn and soybeans have also shown a net gain this week, even with today’s losses. In Wednesday’s session, the March futures for both crops made fresh highs. Fundamentally, not much has changed and we’re still trading headlines. Argentina weather hasn’t been perfect, and their soybean crop may be smaller than initially expected, but a very large Brazilian crop should make up for it, giving the global market ample supply. Whether you’re looking to market old crop or new crop, give us a call and we can come up with some plans. Enjoy the game on Sunday!
Ralph Wince
Grain Merchandiser, Canfield (Region 5)
Good afternoon, markets have been on a roller coaster ride again this week. Mar25 CBOT corn has tested the $5.00 mark a number of times this week. The closest we have gotten this week was $4.9850. There is really strong resistance at $5.00. If we can break through that number, then we would have some more upside potential in the short term.
South American bean harvest has begun and there have been reports that trucks have been waiting in line for as long as 24-36 hours to dump. China will soon begin to get their bean needs from South America. It’s hard to see a whole lot of upside in this bean market near term. Most are looking for a reduction in acres in soybeans this year and an increase in corn acres on the March 31st Prospective Plantings Report.
Corn basis continues to be firm here in NE Ohio. With southern Ohio, Virginia and North Carolina being short on corn this year we are already seeing them reach up into this part of the state to draw corn that direction. We have a new targeting program that we are using, and all the farmers that are giving us targets really like it. Once we enter the target, you, the farmer, receive a text telling you that it is entered, and when, and if it hits, you receive a text telling you that it is filled. Give us a call to get a target entered for old crop or new crop.
Have a great weekend, the days are getting longer, and spring is getting closer.
Vice President, Grain Division
Good afternoon once again. Wildcards seem to be the theme these days. Tariffs, weather, exports, domestic crush margins. Everything just seems to have a wildcard out there to be played. We came into Sunday night with markets sharply lower on tariffs being put in place on Mexico, Canada, and China. Then by midday Monday those were cancelled and the market rebounded.
The weather in Argentina is getting attention and rightfully so. The corn and bean crops there have seen ratings fall drastically in the past month. Sounds like they are past the point of no return even if rains were to begin now. Will we see a decrease in the size of the Argentine crops in next week's monthly update?
In this week’s export sales report, we did see another big week of corn sales. 58 million bushels which is well ahead of the 10-week average of 46 million bushels. This puts us at 72% of the USDA estimate already sold. Historically we are 65% sold, and the high was 80% back in the 20/21 marketing year. Soybean sales continue to fall off, which they should for this time of the year. Fourteen million bushels on the report yesterday is well below the 10-week avg of 41.8 million. That average will be coming down each week now. Brazilian beans are beginning to hit the marketplace. With that being said, we still have 87% of the USDA estimate sold, compared to the 5-year average of 82%.
Domestic crushing margins for corn have continued to improve this week. The ethanol producers are back in the black and they picked up the pace by producing 97,000 barrels more per day than the prior week. Stocks were also on the rise, coming in at just under 26.5 million barrels. Soybean crush margins continue to struggle as the backlog of meal is hampering them. Argentina exports a lot of meal, so maybe just maybe, we can fill that void and get some of this meal on the move.
We are at 15-month highs for both corn and beans, the funds have switched attitudes, and we are quietly continuing to feed the bull to keep things going. It sounds like we have another round of ice coming tomorrow afternoon/evening so make sure you rush out to get that bread and milk. Have a great weekend.
Lou Baughman
Grain Merchandiser, Kenton (Region 1)
The last couple of weeks we have seen grain deliveries pick up with the movement in the markets. Markets have been choppier this week and seem satisfied in the range that they are in. Tuesday will be the crop report; February usually doesn’t have many surprises. The one we all watch for is Prospective Plantings at the end of March. I watched BAM Weather yesterday and they think February is going to be an active month for storms. It sounds like there will be a large one around the 25th, so don’t plan on putting away your winter clothes for a while.
Briana Holtzman
Grain Merchandiser, Upper Sandusky (Region 2)
It would appear that President Trump’s tariff threats have worked in the way that he anticipated them to with Mexico and Canada. The threat of these tariffs has allowed agreements to be made between the US and these countries to increase border security and decrease the flow of illegal substances into the U.S. The tariff threats on these countries by the U.S. have been pushed to March 1, allowing more time for negotiations to be made. There is still a lot of work to be done between China and the U.S. in terms of tariff negotiations, and grains were not on the list of possible tariffs between these two. The markets reacted very well to this news and rallied early this week.
We are ending the week down, as Brazil saw strong rains with good coverage, and we saw profit-taking from the funds. Next week, on Tuesday, is the February WASDE Supply and Demand report, but it is predicted to be uneventful.
Steve Bricher
Grain Operation Manager, Urbana (Region 3)
It is Superbowl weekend! I know every bar and pizza joint will be hopping. My wife asked me the other night who I was rooting for, and I told her I don’t have a good answer. These types of games I usually start watching and then figure out who I want to win. I just know my Bengals are not there, so I really do not have a dog in the fight.
This has been a wild week for the markets with everything going on in Washington. This is going to be normal for a while as the new administration gets rolling.
The markets seem to be reaching a top at this point. There isn’t a strong reason for them to push much higher, but investment funds have shifted from being short on corn last year to now taking long positions. If, at some point they decide to get out, how far back can we chase these markets? I have been telling customers for the last two months to continue to sell into the rally. I believe in rewarding a market that is improving and not trying to pick a top. At the end of the day, it is about an average and not just one sale.
Lisa Warne
Grain Merchandiser, Marysville (Region 4)
Welcome to Super Bowl weekend! I guess I’ll cheer for the Eagles since the Bengals let me down again this year. In the grain markets this week, wheat was the big winner. The July wheat futures were up nearly 4%, over 20¢, to levels we haven’t seen since October. Extended forecasts for extreme cold in the Black Sea region have traders concerned about crop damage in a wheat crop that already had a less-than-ideal start. Here in the U.S., some hard red winter wheat areas also have colder extended forecasts and continued dryness showing on the drought monitor. Keep an eye out later this month for enrollment details on our wheat average price contract.
Corn and soybeans have also shown a net gain this week, even with today’s losses. In Wednesday’s session, the March futures for both crops made fresh highs. Fundamentally, not much has changed and we’re still trading headlines. Argentina weather hasn’t been perfect, and their soybean crop may be smaller than initially expected, but a very large Brazilian crop should make up for it, giving the global market ample supply. Whether you’re looking to market old crop or new crop, give us a call and we can come up with some plans. Enjoy the game on Sunday!
Ralph Wince
Grain Merchandiser, Canfield (Region 5)
Good afternoon, markets have been on a roller coaster ride again this week. Mar25 CBOT corn has tested the $5.00 mark a number of times this week. The closest we have gotten this week was $4.9850. There is really strong resistance at $5.00. If we can break through that number, then we would have some more upside potential in the short term.
South American bean harvest has begun and there have been reports that trucks have been waiting in line for as long as 24-36 hours to dump. China will soon begin to get their bean needs from South America. It’s hard to see a whole lot of upside in this bean market near term. Most are looking for a reduction in acres in soybeans this year and an increase in corn acres on the March 31st Prospective Plantings Report.
Corn basis continues to be firm here in NE Ohio. With southern Ohio, Virginia and North Carolina being short on corn this year we are already seeing them reach up into this part of the state to draw corn that direction. We have a new targeting program that we are using, and all the farmers that are giving us targets really like it. Once we enter the target, you, the farmer, receive a text telling you that it is entered, and when, and if it hits, you receive a text telling you that it is filled. Give us a call to get a target entered for old crop or new crop.
Have a great weekend, the days are getting longer, and spring is getting closer.