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Prices updated as of 6:55 a.m. CDT.
What we’re watching
Soybean oil futures rallied to the highest levels in over five months Tuesday after President Trump unexpectedly announced a trade deal with India, fueling optimism for greater U.S. ag exports to the world’s most populous nation. Vegetable oil is one of the few major farm products India imports in significant volumes. Corn growers may also have an angle as India ramps up E20 gasoline efforts.
Corn traders eyeing biofuels news
March corn futures fell 2 cents to $4.2650 per bushel in late overnight trading after climbing 2.75 cents Tuesday to $4.2850, ending a two-day losing streak. Futures are still down from a two-week intraday high of $4.34 posted January 29.
Corn technicals eroded overnight as March futures dropped back near the middle of the past three weeks’ range and are poised to close under the 10-day simple moving average, currently about $4.28, for the second time in the past three days. Recent price action suggests sideways consolidation will continue this week, barring any extreme moves in outside markets.
Near-term support in March futures is seen in the mid- to low-$4.20s, including Monday’s low ($4.24) and last week’s low ($4.21). Near-term resistance comes in around the 20-day SMA ($4.2850) and last week’s high at $4.34.
Barchart’s front-month national average cash corn price fell over 2.5 cents Tuesday to $3.9425. Tuesday’s average was about 34.25 cents below March futures, narrowing from 36.75 cents a week ago.
The proposal “is a step in the right direction toward providing the clarity and certainty that ethanol producers are seeking,” Geoff Cooper, president and CEO of the Renewable Fuels Association, told Reuters.
The Energy Information Administration will report weekly ethanol production later this morning. Domestic production has recently tapered off from a record high reached about a month ago but remains above last year’s levels as low-priced corn and strong exports propelled distiller margins.
A week ago, the EIA said ethanol production averaged 1.114 million barrels per day during the week ended January 23, down 0.4% from the previous week and down from a record 1.196 million barrels the week ended January 9. Production over the four weeks ended January 23 was up 5% from the same period in 2025 at 1.132 million barrels a day.
Traders continue to watch South America’s weather and accelerating harvest. AgRural estimated Brazil’s first corn crop at 10% harvested, lagging the 14% pace from last year, and pegged the second crop at about 13% planted, about four percentage points ahead of last year.
On Monday, StoneX said it hiked its estimate for Brazil’s total corn crop by 1.1 MMT, or 0.8%, to 135.5 MMT (5.33 billion bushels). By contrast, USDA forecasts Brazil’s crop at 131 MMT. Dryness in growing areas of the south “is increasingly a concern,” with rains forecast mostly for the upper two-thirds of the country’s grain belt the next 10 days, a StoneX analyst said.
The U.S. cattle herd at the start of the year dwindled to its smallest since 1951, signaling little relief ahead for consumers at the supermarket meat case. Despite record cattle prices fueling beef producers’ profits, there are few signs of meaningful herd expansion. “We’ve quit ‘bleeding’ cows, but we’re not growing,” one broker said.
Soybeans pull back from soyoil-driven rally
March soybeans fell 3.75 cents to $10.62 overnight after gaining 5.5 cents Tuesday to $10.6575, the contract’s first advance in four days. November futures fell 2 cents to $10.7725, moving the soybean-to-corn ratio to about 2.366, up from a two-week low.
Soybeans faded overnight as the market returned to the past week’s neutral-weaker posture, with March futures falling near the mid-point of the range that’s persisted since mid-December. Sideways consolidation appears to be in the cards unless March futures can make a break above some key upside targets, including the 50-day SMA ($10.80) and last week’s high ($10.8550). Initial support comes in at the 10-day SMA ($10.6650) and Tuesday’s two-week low at $10.5175.
Barchart’s front-month national average cash soybean price rose 4.75 cents Tuesday to just over $10.00. Tuesday’s average was about 65.25 cents below March futures, narrowing from 68.75 cents a week ago.
March soybean meal fell $2.70 to $289.20 per ton after earlier dropping to a two-week intraday low. March soyoil was little changed at 54.49 cents per pound after jumping 2.4% on Tuesday to 54.59 cents, the contract’s highest close since late August.
Soybeans faded overnight in a pullback from Tuesday’s rally, which was led by soyoil and driven partly by the announcement of a trade deal with India. India is a big producer of staple crops, but vegetable oil is one of the few major ag products it imports in significant volumes, at about 16 MMT annually. “India’s edible oil demand mix could gradually shift, with U.S. soyoil potentially gaining from improved market access,” said Darren Lim, a derivatives analyst at StoneX.
The Treasury Department’s 45Z’s announcement also spurred buying in the soy complex amid hopes the program will eventually lead to greater demand for soybeans from biodiesel producers. Biofuel trade groups welcomed the update, saying it could provide more certainty for biofuels producers seeking the credit. The program was created under former President Joe Biden's Inflation Reduction Act and was amended last year in Trump's One Big Beautiful Bill.
Changes included allowing for low-carbon fuel produced with feedstocks grown in Canada and Mexico as well as tweaks to the methodology for calculating a feedstock's land use intensity, Reuters reported. But several uncompleted steps remain, including biofuels blending guidelines from the Environmental Protection Agency.
“The major focus for the industry will continue to be the expected guidelines coming from the EPA, hopefully at some point over the next four to five weeks,” Arlan Suderman, Chief Commodities Economist at StoneX, said in a report. “Farmers hope that the final biofuel program will provide sufficient domestic demand for oilseeds to replace lost soybean demand to China, while also helping to bring profitability back to producing oilseeds. Many have held off marketing decisions based on that hope.”
Price upside likely will be capped by signs of a slowdown in U.S. soybean exports and heightened competition from what’s expected to be a massive Brazil crop. Even after a flurry of Chinese buying the past two months, U.S. soybean shipments for 2025-26 to date are still down 36% from the same period in 2024-25.
Earlier this week, StoneX raised its estimate for Brazil soybean crop by 4 MMT, or 2.3%, to 181.6 MMT, (7.15 billion bushels), citing a customer survey. USDA by contrast pegged Brazil’s crop at 178 MMT, up 3.8% from 2024-25 and a record for the fourth year in a row.
Winter wheat crop ratings show mixed picture
March SRW wheat fell 3 cents to $5.2575 after adding 1 cent Tuesday to $5.2875 and halting a two-day slide. Futures are still down from a 10-week intraday high at $5.4475 last Friday.
Wheat technicals slipped this week as March SRW futures dropped back under the 100-day SMA ($5.3025) after three consecutive closes above that widely-watched longer-term indicator. March futures also pushed under the 10-day SMAs ($5.29) overnight, which could set up a test of the 50-day SMA ($5.23).
March HRW wheat fell 4.25 cents to $5.3050 after easing 0.5 cent Tuesday to a one-week closing low. March spring wheat fell 0.5 cent to $5.6775 after sinking 3.25 cents Tuesday to $5.6825, a two-week closing low.
Wheat futures followed corn and soybean futures lower overnight as grain markets appeared to disregard strength in outside markets including crude oil and metals. The dollar’s recent rebound has also tempered buying interest in grains. Wheat’s upside remains limited by a bearish global supply outlook and stiff export competition, as well as fading concern over potential winterkill in U.S. and Ukraine wheat areas.
Updated state-level USDA crop condition ratings from several top growers earlier this week reflected a mixed picture.
In Kansas, 61% of the winter wheat crop was rated “good” or “excellent” as of Sunday, up from 60% a month ago and 50% a year ago, USDA reported. Topsoil moisture was rated 59% “adequate” and 6% “surplus,” with 37% rated “short” or “very short.”
Weaker numbers from other states may reflect weather problems, including an expanding drought in the Southern Plains. In Oklahoma, the crop was rated just 23% good-to-excellent, down from 31% a month ago and down from 40% a year ago. Nebraska posted a 24% good-to-excellent figure, down from 40% a month ago and 25% a year ago.
Overall, the latest wheat ratings suggest a crop that’s “not a disaster nor a bin-buster at this point,” Bevan Everett of StoneX wrote.
Elsewhere, Ukraine’s state weather office said last week’s cold temperatures and other weather conditions during January did not appear to detrimentally impact winter crops, specifically saying soil temperatures at critical depths for the winter wheat crop did not reach damage- threat levels.
Stock index futures firmer after tech-led slide
Stock index futures were steady to firmer overnight as the markets stabilized following Tuesday’s technology-led downturn. Investors await the ADP employment report and additional earnings reports.
Futures based on the S&P 500 index and the Dow industrials both rose over 0.2%, while Nasdaq-100 futures were little changed. The U.S. dollar index rose slightly as the benchmark extended a recovery from four-year lows reached in late January.
March WTI crude oil futures added 27 cents to $63.48 per barrel. Precious metals continued to rebound from the recent selloff, with gold futures up almost 3% at about $5,049 ounce and silver futures up over 7% at about $89.61 per ounce.
What else I’m reading at www.FarmFutures.com this morning:
- Meet me in San Antonio? The Commodity Classic, the annual joint conference of the National Corn Growers Association and the American Soybean Association, is gearing up to welcome farmers for its 30th anniversary February 25-27. You can still register to attend.