Corn futures posted some gains ahead of Friday's USDA report day, with contracts up 1 to 2 ½ cents across most months. Futures were supported by expected export data from the USDA. Market participants expect that corn exports could amount to 0.7 to 1.4 million tons for 2024/25 in the week ending January 2. Sales for 2025/26 are estimated at 0 to 100,000 tons. The USDA will release its annual crop production report today on Friday morning (local time), with analysts polled by Reuters forecasting a drop in yield and also in crop forecasts. Grain stocks data will also be released, with traders estimating corn stocks at 12.147 billion bushels as of December 1, down 24 million bushels from last year if the forecast becomes reality. On a global basis, analysts expect little change in the Brazilian crop of 127 million tons, while the Argentine crop is expected to decline by 0.5 million tons to 50.5 million tons. World ending stocks are estimated at 294.80 million tons, down 1.64 million tons from December. Meanwhile, South Korean importers bought a total of 65,000 tons of corn of US or South American origin overnight. In addition to the new WASDE report, the weather remains an issue. Meteorologists from NOAA confirmed that the duration of the weather phenomenon is expected to be limited to just a few weeks. By the end of April, experts expect the effects to slowly subside. Typically, La Niña brings cooler and wetter weather to North America in spring, while it is drier than usual in South America.
On Thursday, the state funeral for former US President Jimmy Carter caused trading on the US stock exchanges to be shortened, resulting in a decline in trading volumes compared to previous days. Wheat prices in the USA continued their downward trend on all three US exchanges: the March contract in Chicago fell by 4.00 US cents to 532.25 US cents/bushel, equivalent to €189.76 per tonne. The funeral celebrations also led to the weekly USDA report on export bookings being postponed until Friday. The Wasde report for January will also be published at the same time, which market observers believe could cause major price movements. Weather conditions in the USA and Russia also weighed on the markets. Snowfall is expected in both countries in the coming days, which will ensure that plants are supplied with water again when it melts, and the snow will also provide protection against frosty temperatures. In Russia, the introduction of the export limit of 10.6 million tons of wheat for the period from 15 February to 30 June has led to many traders trying to sell their goods on the market before then, putting significant pressure on prices on the Black Sea. According to Russian experts, the unfavourable growing conditions mean that wheat exports for 2024/25 will fall to 45 million tons, a significant decline compared to 54.7 million tons in the previous year. On Euronext in Paris, wheat prices were unable to escape the bearish impulses and continued to fall. The leading March futures contract recorded a loss of €1.50 to €229.25 per tonne.
ZMP Live Expert Opinion
Today's WASDE report is eagerly awaited. Yesterday's trading was much quieter due to the shortened trading day in the USA, so many market participants expect that today could go in one direction or the other. Price pressure from Russia is likely to be short-lived, as selling pressure will ease following the introduction of the export limit. If the La Nina weather phenomenon continues to prevail in the south of the USA, this could continue to pose a threat to stocks. In the meantime, grain stocks in large parts of the EU look satisfactory, so that Paris prices are currently oriented towards global market developments.
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