In the overnight session corn soybeans and wheat were mostly unchanged to slightly higher. Yesterday’s export inspections were positive for corn and soybeans which both beat analyst expectations. Soybeans recorded 1.5 million metric tons inspected for export which beat the high side of analyst expectations by nearly 50,000 metric tons. Corn beat expectations by an even higher margin, recording 886,825 metric tons compared to expectations which ranged between 600,000-750,000 metric tons. Wheat expectations were weak again with only 263,035 inspected to leave the country well on the low side of the average analyst guess.
Yesterday, the USDA attaché report adjusted wheat production to 12.5 million metric tons and 14/15 corn production to 22.5 million metric tons. Both estimates for corn and wheat are 500,000 metric tons over the USDA official estimate in the January Supply and Demand report.
Wheat continues to experience selling pressure as the market looks for some signs of life in the export sector. Since the sharp run-up in wheat prices which peaked on December 26th, the market has been searching for a pickup in wheat sales that would have otherwise gone to Russia. However, U.S. wheat has struggled to gain competitiveness in the global market with the sharp decline in the Euro and the U.S. Dollar continuing to gains strength.
In Brazil, showers are expanding in the central regions this week with the North East parts of the growing region expecting to receive precipitation by next week. Northern Brazil has experienced significant precipitation deficits over the last 30 days, with actual precipitation 61% below the average precipitation for that time period. The lack of precipitation over the month of January has led AgRural to announce last Friday it expects to cut Brazil soybean production forecasts in their February report. Soybeans bounced over 11 cents yesterday and could possibly trade higher today. Overhead resistance is around the $9.91 level.
