2.23.24 Tredas Weekly Recap

Weekly Action:

Corn Mar24 down 16 at $3.99

Beans Mar24 down 42 at $11.35

KC Wheat Mar24 up 3 at $5.69

Hogs April24 up .95 at $87.175

Fats April24 up .45 at $187.70

Feeders Mar24 up 3.65 at $254.275

Corn Dec24 down 8 at $4.49

Beans Nov24 down 22 at $11.30

KC Wheat Jul24 up 4 at $5.58

New Crop Bean/Corn Ratio: 2.52

Crop Insurance Price so far:

Dec24 Corn: $4.68

Nov24 Beans: $11.62

Market Recap:

One of the most bearish months in recent memory continues to punish the bull camp as March Corn as had only 3 higher daily closes so far this month. December24 have had their worst February since 2013. March contract expiration, further fund selling, favorable weather in South America are all weighing on the futures market currently. Buenos Aries Grain Exchange reported good/excellent conditions up 1% on the week and said recent rains have improved the crop after the recent 3-week dry spell.

Corn weekly export sales range of estimates were 700k – 1.5mil tonnes. Actual exports landed at the lower end of the range coming in at 820k.

Bean weekly export sales range of estimates were 300k – 800k tonnes. Actuals landed well below expectations at a measly 56k.

The Biden Administration on Thursday approved year-round E-15 sales, which is a good sign for long term ethanol production trends. However, the ethanol lobby is a bit disappointed that sales don’t start until 2025, likely due to the face the administration does not wat to risk a spike of gas prices in an election year.

Average daily ethanol production last week of 1.084mil barrels was the highest since 2018. Up .1% from last week and 5.3% from last year. The 5 year avg for this eek is 1.000 barrels.

USDA announced a rare sale of 126k tonnes of Milo to China Thursday morning. First Milo sale since November of 2020. Seeing exports and China in the same sentence moving forward would be a nice change of pace, but as things sit today FOB US Gulf bean prices are still $42 per ton premium to Brazil and $23 per ton premium at the Pacific Northwest ports.

Cattle on Feed:

-February 1 Cattle on Feed slightly higher than expected

-January Placements higher than expected but 8-year low

-January Marketings as expected

Weather:

Weather forecasters are raising the odds of the demise of the current El Nino (areas in the northern U.S. and Canada are dryer and warmer than usual. But in the U.S. Gulf Coast and Southeast, these periods are wetter than usual and have increased flooding)  pattern by May. US summer growing weather could be unpredictable depending on how quickly the pattern shifts to La Nina (This tends to lead to drought in the southern U.S. and heavy rains and flooding in the Pacific Northwest and Canada).

Forecast for South America is mostly non-threatening for crops. Rainfall is slated to be mostly adequate through the next 7-10 days.

Economy:

The S&P 500 stabilized Friday after hitting another record as investors looked to end the week on a high note.

The S&P 500 added 0.1%. Earlier Friday, the broad market index broke above 5,100 for the first time. The Dow Jones Industrial Average added 91 points, also reaching a fresh record.

Wall Street is coming off a monster session as Nvidia shares roared higher on strong quarterly results, leading the chipmaker to surpass a $2 trillion valuation. The S&P 500 had best day since January 2023, while the Nasdaq Composite popped 3% for its best session since February 2023. The 30-stock Dow gained 1.2%.

All three major averages are on track for winning weeks. The S&P 500 is pacing for a 1.8% advance, while the tech-heavy Nasdaq has gained roughly 1.6% so far this week. The Dow is up 1.4% for the period.

The Mortgage Bankers Associations weekly report was negative for real estate industry in all directions. The avg 30 year mortgage rate rose for the 5th consecutive week to a 10 week high of 7.06%. Rising rates slowed real estate demand and mortgage application index fell 10% from the previous week.

Something That Probably Means Nothing:

The SEC has charged a Houston resident with insider trading for using non-public info he obtained from his wife, a manager with BP, without her knowledge, about the company’s planned merger with TravelCenters of America.

He made $1.7 million by trading on wife’s work from home calls.

Quote of the Week:

“Don't let yesterday use up too much of today.” – Will Rodgers