Another volatile trading week is drawing to a close, and this is also the last trading day of the month. Wheat futures continued their profit rally on the three US markets on Thursday. Chicago SRW futures rose another 3 to 4 cents in the front futures. Kansas futures gained a bit more with gains of 7 to 8 cents in the front months. In Minneapolis, contracts ended the day up 5 to 7 cents. Meanwhile, market participants are once again concerned about weather developments in many important growing regions. According to meteorologists, rainfall remains limited in many parts of the Plains for the next week.
Late Thursday afternoon, President Trump declared that he would impose the 25% tariffs on goods from Mexico and Canada on Saturday. So far, no retaliatory measures have been officially announced by either country. In 2024, wheat exports to Mexico accounted for 16.56% of the total. In addition, export sales data was also released early yesterday morning. The USDA showed sales of 456,086 tons during the week of January 23. This is well above the previous week and almost 41% higher than in the same week last year. Market participants were positively surprised - the result was at the upper end of the range of 150,000 to 500,000 tons. The largest buyer was the Philippines with 86,200 tons, followed by unknown buyers with 85,300 tons. Sales for 25/26 were in line with expectations at 24,204 tons, split between Peru and El Salvador. Meanwhile, Japan was also active again, buying 89,134 tons of wheat from the US and Canada overnight, of which 29,070 tons were specifically from the US.
On Euronext, the green signs also prevailed with support from overseas. Prices for March rose by 2.00 euros/tonne to 234.50 euros/tonne.
On Thursday, the front month of the US corn market was under selling pressure due to the upcoming end of the month. Trailing futures also fell by 2 to 7 cents in the session. In corn, Trump's announcement about the introduction of tariffs on Mexican and Canadian goods also caused unrest on the markets. Late Thursday afternoon, President Trump announced that he would impose a 25% tariff on Mexico and Canada on Saturday. Currently, there are still 7.93 million tons of corn on the order books for Mexico in the current marketing year, despite the tariffs, the US continues to have a freight advantage over most other suppliers. Additionally, over 35% of 2024 ethanol exports were shipped to Canada. This morning's USDA export sales report showed a total of 1.359 million metric tons in the week ending January 23, which was in the middle of estimates. This was down 18.2% from the previous week, but still up 12.6% from the same week last year. Japan was the largest buyer with 493,100 tons, followed by Mexico with 426,900 tons. Another 45,800 tons were reported for shipment in 2025/26, all to Japan.
Like wheat on Euronext, corn also benefited from the rising grain markets and recorded marginal gains.
ZMP Live Expert Opinion
The grain markets are currently struggling to find a clear direction. Volatile movements continue to characterize trading. Although concerns about weather developments are giving the bulls a tailwind, Trump is still keeping traders on their toes. This is unlikely to change much in the coming weeks. However, possible retaliatory measures from Mexico and Canada could still cause unrest.
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