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Corn Turns Higher on Drier Argentina Forecast -- Daily Grain Highlights

01/14/2022 | 03:39pm

By Kirk Maltais

--Corn for March delivery rose 1.5% to $5.96 1/4 a bushel on the Chicago Board of Trade Friday, in reaction to a drier shift in the weather forecast for Argentina which is expected to adversely affect parched crops there.

--Soybeans for March delivery fell 0.5% to $13.69 3/4 a bushel.

--Wheat for March delivery fell 0.7% to $7.41 1/2 a bushel.


HIGHLIGHTS


Parched Pampas: The drier turn in the weather forecast for Argentina was a key source of support for corn futures Friday. "The details of Argentine forecasts are beginning to lean bullish as principal crop areas will stay arid for another seven-to-eight days," AgResource said. Climate guidance is trending warmer and drier in Argentina and Paraguay, the firm added, which may have an adverse effect on the corn crop there.

Weighed-Down Wheat: Wheat futures on the CBOT have been on the decline since the USDA released the WASDE on Wednesday. "The bigger-than-expected winter acres by the USDA has the market putting together fairly loose new crop balances," said Richard Buttenshaw of Marex Spectron. "This at a time when the U.S. is still not competitive on an export front is leaving wheat with very few friends." It's the third consecutive lower finish for wheat futures.


INSIGHTS


Shift in Strategy: Soybean futures fell Friday, with the drop coming as Chinese officials indicated plans to set aside more acreage for growing their own soybeans--all this while Beijing still hasn't met the targets for purchasing U.S. soybean exports set in 2020's Phase One trade deal. "As we all know plans can go awry, but the Chinese government has also promised to encourage additional bean acreage this coming year in an effort to reduce the dependency on imports," said Dan Hueber of the Hueber Report. How this plays out is likely to affect soybean movement in the coming trading sessions.

Input Strain: The income of U.S. farmers is expected to drop in 2022, according to the Federal Reserve Board. "Expectations are for income to be lower in 2022 than in 2021, as recent growth in input prices outpaced growth in agricultural goods prices and farmers expected the trend to continue," said the Federal Reserve in a report published this week. Higher costs for inputs like fertilizer as well as fuel and transportation are pressuring farmers' budgets globally, even as grain futures remain at high levels not seen in years.


AHEAD:


--The Chicago Board of Trade will be closed Monday in observance of Dr. Martin Luther King Jr. Day.

--The USDA will release its weekly grains export inspections report at 11 a.m. ET Tuesday.

--The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Thursday.

--The USDA will release its monthly livestock slaughter report at 3 p.m. ET Thursday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

01-14-22 1538ET

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