2/7/2022

The markets opened Sunday night with some big strength, with our front months gapping almost nine cents higher on corn and 18 cents on soybeans from the Friday closing prices.  Trade did not immediately fill these gaps and we ended the day with them still present on the daily corn charts out through September 2023.  Soybean daily charts have a gap higher out through September 2022.  Sharply higher trade was fueled by a forecasted continuation of dry weather in South America and some sudden attention being given to the long-term North American weather pattern into June/July.  The USDA confirmed another sale at 8 a.m. this morning with 507,000 tonnes of soybeans to unknown, split approximately 50/50 between the 2021/22 and 2022/23 marketing years.  Traders don't use much of their imagination in determining who the "unknown" destination is, most immediately assume it is more China business.  The weekly export inspections were on the lower end of expectations but efficient for corn.  Corn inspections totaled 1.053 mln tonnes and soybean inspections totaled 1.218 mln tonnes.  Export shipment pace for corn is now 130 million bushels short to meet the USDA's target, compared to 148 million bushels the previous week.  Soybean export shipment pace is now on target to meet the USDA target, squandering around a 20 million bushel cushion a couple months ago.  With some new old crop sales now on the books for US soybeans, trade will be paying close attention to export pace to see if recent sales will be absorbed into the original forecast totals or if the USDA will revise its number higher.

Still waiting for a story to develop on corn.  Potential for a good run on the futures.  It appears daily and/or weekly close in the 640’s would open the door for a relatively easy run towards 700’0.
Soybeans continue higher, looked poised to challenge all-time highs at some point this year.