Written Commentary
The Ghost in the Machine Q1 2025
March 25, 2025
CORN
Prices were $.08-$.09 higher today with Dec-24 futures reaching a 5 week high. Next resistance for Dec-24 is the July high of $4.26 ½. Spreads were little changed. Export inspections at 38 mil. bu. were in line with expectations. YTD inspections at 2.048 bil. are up 40% from YA vs. the USDA forecast of up 35%. With census exports running 192 mil. bu. over inspections suggests YTD shipments have reached 2.241 bil. with 2 days left in the old crop MY, vs. the USDA export forecast of 2.250. bil. Census data from July is due out tomorrow. Last week money managers were net buyers of 16k contracts reducing their net short position to just below 242k, their smallest short position since late June. Brazilian farmers in the center-south region have planted 8% of their first corn crop, up from 4% LW. Celeres is forecasting Brazil’s 24/25 corn production at 134.1 mmt, up 5 mmt from YA and well above the USDA forecast of 127 mmt. Corn used in the production of ethanol in July reached 473.5 mil. bu. up 6% from June and the highest for the month in 6 years.
SOYBEANS
The soybean complex was mixed with beans $.12-$.15 higher, meal was up $7-$9 while oil was 90-110. Nov-24 beans have reached a 4 week high with next resistance at its 50 day MA at $10.37. Oct-24 meal surged thru its 50 day MA with its next resistance is the August high of $333.40. After trading limit down, spot canola recovered a bit however still closed at its lowest level since Dec-2021. Export inspections at 18 mil. bu. were at the high end of expectations. YTD inspections at 1.643 bil. are down 15% from YA, in line with the USDA forecast. With census exports running 50 mil. bu. over inspections would suggest YTD sales have reached 1.693 bil. vs. the USDA export forecast of 1.70. bil. China took just over 7 mil. bu. In addition the USDA announced the sale of 132k mt (5 mil. bu.) of soybeans to China. Last week MM’s were net buyers of 16k contracts of bean oil, just over 6k soybeans and 1,500 meal. On Friday the EIA reported RD production capacity jumped 7% in June alone to nearly 4.9 bil. gallons annually. This is up 27% from the end of last year. RD production surged to a record 295 mil. gallons in June. Combined biodiesel and RD production was also a record at 464 mil. gallons. Bean oil usage in June surged to 1.267 bil. lbs. up nearly 18% from May and was the 2nd highest monthly usage figure ever reported. Celeres is forecasting Brazil’s 24/25 soybean production at 169.9 mmt, a touch above the USDA forecast of 169 mmt. July-24 census crush at 193 mil. bu. was in line with expectations. With only Aug-24 crush data left in the 2023/24 MY, cumulative crush has reached 2.120 bil. bu.
WHEAT
Prices were higher across all 3 classes today with KC and Chicago up $.11-$.15 while MGEX was $.05-$.07 better. Dec-24 Chicago closed very near its 50 day MA resistance at $5.66. Same with Dec-24 KC at $5.76. Export inspections at 21 mil. bu. were at the high end of expectations. YTD inspections at 211 mil., up 32% from YA, vs. the USDA forecast of up 15%. Last week MM’s were net buyers of just over 3k contracts of KC wheat, sellers of just over 3k Chicago while also selling 1,600 MGEX. ABARE raised their Australian wheat production forecast by 2.7 mmt to 31.8 mmt, up nearly 6 mmt from YA and just above the USDA forecast of 30 mmt. SovEcon lowered their Russian wheat production forecast by .8 mmt to 82.5 mmt, just below the Aug-24 USDA est. of 83 mmt. EU soft wheat exports for the 24/25 MY as of Aug. 30th had reached 4.38 mmt, down 22.6% from YA.
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