Written Commentary
CORN
Prices were $.01-$.03 higher in choppy 2 sided trade. Spot Mch-25 carved out a fresh 6 month high while spreads weakened a bit. Next resistance rests at $4.68 with nearby support at $4.51 ¼. Ethanol production rebounded to 327 mil. gallons, up from 326 the previous week and up 6% from YA. Production was above expectations and above the pace needed to reach the USDA corn usage est. of 5.50 bil. bu. There was 112 mil. bu. of corn used, or 16.0 mbd, well above the 14.9 mbd needed to reach the USDA. In the MY to date there has been 1.813 bil. bu. used of 15.37 mbd, an annualized pace of 5.609 bil. Ethanol stocks jumped to a 15 week high of 23.64 mil. barrels and just above the 23.58 mb from YA. Implied gas usage LW slumped 9.3% from the previous week, however was up 2.7% YOY. Tomorrow’s export sales are expected to range from 25-55 mil. bu. Corn usage in the production of ethanol slipped to 465 mil. bu. in November, in line with expectations. Usage in Oct-24 was revised up just over 6 mil. bu. to 466.7 mil. Cumulative usage in the Q1 of the 24/25 MY has reached 1.380 bil. bu. up 2.4% from YA, vs. the USDA forecast of up less than 1%.
SOYBEANS
Prices were mixed across the complex with beans $.01-$.03 higher, meal was $3-$4 higher, while oil slipped late closing 10-15 lower. Mch-25 soybeans jumped out to a 6 week high however stopped short of testing its 100 day MA resistance at $10.19 ¼. Mch-25 oil traded above LW’s high before pulling back in choppy 2 sided trade. Support rests at the Dec-24 low of 39.50. Mch-25 meal traded to a fresh 2 ½ month high. Next major resistance not until the Oct-24 high at $347.60 with support at the 100 day MA at $311.20. Spot board crush margins jumped $.05 ½ to $1.21 ½, while bean oil PV fell to 39%, the lowest in 3 months. Deliveries against the Jan-25 contracts were 380 contracts of beans, 648 of meal and 192 of oil. Palm oil prices were down 2.6% overnight as it appears Indonesia has yet to implement the 5% increase in diesel blended with biofuels up to the 40% mandate in 2025. With record soybean production in Brazil remaining a strong probability, the upside would appear limited, however growing concern over dryness in Central Argentina and far Southern Brazil is cause for concern. Export sales are expected to range from 18-38 mil. bu. for beans, 150-300k tons of meal and 5-30k tons of oil. Census crush in Nov-24 at 210 mil. bu. was down from the all-time record of 216 mil. in Oct-24 however at the very high end of expectations. This was the 2nd highest monthly crush ever, bringing cumulative crush in Q1 of the 24/25 MY to 613 mil. bu. up 6.3% from YA, vs. the USDA forecast of up 5.4%. Soybean oil stocks rose 8.5% to 1.612 bil. lbs. well above expectations of slipping to 1.420 bil. lbs.
WHEAT
Wheat continues to be the weakling within the ag. space with prices down $.05-$.07 across all 3 classes. While fresh news is scarce the expected snow cover from eastern KS across the Southern Midwest will provide protection for the winter wheat from damaging cold. Limited precipitation for E. Ukraine, S. Russia and W. Kazakhstan over the next few weeks. US WW acres in drought fell 2% LW to 25%, the lowest since July and down from 32% YA. Spring wheat acres in drought held steady at 33%. Just over a week until the Jan-25 USDA production, WASDE and Dec. 1st stocks report, along with the USDA’s first look at 2025 winter acres. Right now leaning toward 1 – 1.5 mil. acre reduction from the 33.39 mil. acres planted YA. Export sales are expected to range between 8-20 mil. bu.
Charts provided by The Hightower Report.
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