Spec Traders Cont to Pour Back Into The Long Side

MORNING AG OUTLOOK

Mixed trade overnight as Ag markets continue to digest Pres. Trump’s call for China to up their purchase of US soybeans.  Despite Chinese Govt. storage being full and Brazilian FOB offers $1 bu below US offers at the Gulf, speculative traders continue to pour back into the long side of the market.  Current pricing dynamics will shift all non-Chinese buyers to cheaper SA supplies.  A lot building up to the EPA announcement next month on RVO’s and SRE’s followed by Pres. Trump’s visit to China in April.  The trade expects little change in US corn, soybean or wheat stocks in next Tues. USDA WASDE updates.  Scattered rains are providing temporary relief in EC Argentina.  More is needed to improve crop prospects.  BAGE confirmed another week of decline in crop ratings.  Wetter conditions in NC Brazil may slow soybean harvest and 2^nd corn plantings.  Dry across much of the central Midwest into early next week.  Moisture towards the end of the 7 day outlook to favor the GL region and ECB.  Little to no precipitation for the US plains.  A gradual warming trend is underway across the Central US with above normal temperatures thru week 2 of the outlook.  Spot crude is down $.20 a barrel.  US $$$ is near unchanged.  US equity markets look to bounce back from yesterday’s heavy losses.

Corn: 

Mch-26 is down $.01 at $4.34 while holding within yesterday’s range.  The BAGE reports Argentine corn ratings slipped 1% to 44% G/E while lowering their production forecast 1 mmt to 57 mmt, still well above the USDA’s 53 mmt est.  Lower FOB offers from Argentina starting to cut into US exports.  USDA updates in Feb-26 show farm income expected to fall nearly 1% in 2026 to 153.4 bil.  Losses would have been much greater if not for a 45% increase in Govt. aid to 44.3 bil.  Spot prices remain rangebound between $4.15-$4.40.  .

Soybeans: 

Mch-26 beans are up $.04 at $11.16 while trading to a new 2 month high.  Mch-26 oil is down 10 at 55.55.  Mch-26 meal is up $3.00 at $306.20 trading to a 1 month high.  O.I. was higher across the complex yesterday with the heavy speculative buying in bean and meal.  Bean O.I. was up 17k contracts, oil up 8k while meal was up 1.6k.  The BAGE showed Argentine crop ratings plunged 9% to 40% G/E, however still well above the 20% from YA.  Stats Canada at 7:30 AM expected to show canola stocks as of Dec. 31^st at 15.76 mmt, up from 13.2 mmt YA.  Range of est. 15.0-16.6 mmt.  Brazilian exports in Feb-26 expected to surge to 11.42 mmt vs. 9.73 YA.

Wheat: 

Mixed trade overnight with prices ranges from down $.01 in MIAX to $.03 higher in Chicago.  CGO Mch-26 holding trade above its 100 day MA at $5.30 ½.  Resistance for KC Mch-26 at the January high of $5.50.  The 6-10 and 8-14 day outlooks have shown above normal precipitation for a week now with the 7 day outlook dry.  Shouldn’t this precipitation be moving forward ?  Yesterday’s drought monitor showed US WW acres in drought grew 2% to 43%, nearing its 52 week high of 45%.  Stats Canada expected to show all wheat stocks as of Dec. 31^st at 26.58 mmt, up from 25.96 mmt YA.  Range of est. 25.2-28.1 mmt.

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