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Prices updated as of 6:55 a.m. CDT.

What we’re watching

At the recent American Farm Bureau Federation convention in San Antonio, one person in particular was a powerful presence even though he was nowhere near the Gonzalez Convention Center. As President Trump moves to reorder immigration, trade and other critical areas for agriculture, it’s important AFBF have a “seat at the table,” the group’s leader said.

Argentina dryness underpins corn market

March corn fell 2.5 cents to $4.9450 per bushel late in overnight trading after soaring 11.75 cents Wednesday to $4.97, the contract’s highest settlement since late May and the highest close for a nearby contract since October 2023. March futures came within 2.5 cents of $5, while May and July futures ended at $5.0750 and $5.09, respectively.

Corn futures remained near 15-month highs after Thursday’s rally, which was driven in part by concern over dry conditions in Argentina and slow planting in Brazil, as well as hopes the U.S. will avoid a protracted trade dispute. Prospects for smaller supplies from Russia also supported the market.

Brazilian corn stocks are particularly tight heading into 2024/25, and planting of the second corn crop, which accounts for almost 80% of the country’s corn production, is off to a slow start, Reuters reported. Second corn in top growing state Mato Grosso was just 1% planted as of last Friday, the date’s slowest pace since 2011 but nearly identical to 2021. Both of those years plus 2016, another slow year, coincided with some of the state’s poorest corn yields.

In Argentina, hot and dry weather likely will persist the next couple of weeks, with some prospects for improved rainfall by mid-February. Temperatures are expected to be above normal the next 15 days, with the hottest conditions shifting from north to south.

Corn and soybean exports are sharply up from last year’s pace but likely will slow as supplies from the accelerating South American harvest reach the global market. USDA will report weekly export sales early today.

USDA is expected to report net weekly U.S. corn sales for 2024/25 delivery at between 850,000 metric tons to 1.8 million metric tons (33.5 million to 70.9 million bushels), compared to 1.661 MMT (65.4 million bushels) the previous week, based on a Reuters survey of analysts.

On cash markets, basis levels at country elevators and processors in Illinois held mostly steady on Wednesday. Barge loading elevators on the north Illinois River were steady to up 2 cents, while other river locations held unchanged. Basis bids at the U.S. Gulf Coast were also mostly steady. Bids for CIF January corn barges kept at 69 cents over March futures and February export premiums held at 80 cents over futures.

Soybeans pull back from rally

March soybeans fell 9.5 cents to $10.5075 late in overnight trading after rallying 15.5 cents Wednesday to $10.6050, the contract’s highest close in nearly a week. The price closed firmly above the 10-day SMA at $10.4975, which may embolden bulls to target last week’s 3 1/2-month intraday high at $10.7625.

Prices remain supported by dryness in Argentina, though Brazil is faring better in terms of moisture. A drying trend is emerging along portions of central-west and southeast Brazil, while the south is expected to receive persistent rains that should help crops, according to a Reuters report. Price gains may be limited by Argentina’s recent lowering of taxes on its grain exports, which could encourage farmer corn and soybean sales.

March soybean meal fell $2.30 to $307.50 per ton. March soybean oil fell 44 points to 44.53 cents per pound.

Net weekly U.S. soybean sales are expected to come in anywhere from 450,000 MT to 1.7 MMT (16.5 million to 62.5 million bushels), compared to 1.492 MMT (54.8 million bushels) the previous week, based on the Reuters survey.

In cash markets, basis levels held mostly steady at country and terminal elevators and at processors in Illinois on Wednesday. At the U.S. Gulf Coast, soybean bids eroded amid sluggish demand and ample supplies in the wake of a recent increase in farmer sales.

Soybean export loadings are at their lowest point since the U.S. harvest began and exporters have not been booking fresh sales to overseas buyers as newly harvested Brazilian beans are available at lower prices, traders told Reuters. Bids for CIF Gulf soybean barges loaded in January fell 3 cents to 58 cents over March futures. February barges fell as much as 3 cents to 62 cents over futures.

Wheat supported by tighter Russian supplies

March Chicago SRW wheat rose 0.25 cent to $5.6275 late in overnight trading after surging 17.25 cents Wednesday to $5.6250, the contract’s highest close since December 11. Futures are up 7% from a contract low of $5.26 posted January 10.

March Kansas City wheat rose 1.5 cents to $5.8175 after ending Wednesday at its highest price since November 7. March Minneapolis wheat rose 2.5 cents to $6.1625 after also finishing Wednesday at the highest level since early November.

Price support stems from a tighter outlook for Russian supplies, as well as a recent cold snap in the central U.S. that may have damaged the winter crop. Earlier today, Russia's Sovecon consultancy said it revised down its forecast for the country’s wheat exports to 42.8 MMT from 43.7 MMT, citing a persistently slow shipment pace and challenging export conditions.

Also, Russia’s agricultural minister said Russian grain exports will fall by one-fifth in 2024/25 from last season's record to 57 MMT after the harvest was hit by bad weather. The minister said Russian companies exported 37 MMT in the first half of the export season and that an almost 70% cut in export quotas for the second half of the season was made to protect the domestic market.

Net weekly U.S. wheat sales for 2024/25 are expected to range from 150,000 MT to 500,000 MT (5.5 million to 18.4 million bushels), compared to 1.492 MMT (54.8 million bushels) the previous week, based on the Reuters survey.

On cash markets, hard red winter wheat basis levels held steady across Kansas on Wednesday. Country elevator bids ranged from 60 cents under March futures in the south to 80 cents under March in the west, according to a USDA report. Terminal elevator bids were unchanged and ranged from 20 cents under March futures in the south to 60 cents under March in the north.

Weekend precipitation for eastern Corn Belt

Much of the eastern Corn Belt and mid-South likely will receive precipitation today through Sunday, with heaviest amounts expected for a band stretching from northern Arkansas eastward through Kentucky. Southeast Iowa, Northern Illinois and much of Indiana and Ohio may receive 0.5 to 1 inch. The Plains look mostly dry.

Longer-term, temperatures in most of the central and eastern Midwest may turn normal to slightly above normal, based on the National Weather Service’s latest 8-to-14-day outlook for February 6-12. Temperatures in the Northern and Central Plains may be slightly below normal. Precipitation during that period may be slightly above normal across most of the Midwest and Plains.

Stocks mostly firm after Fed holds steady

U.S. stock index futures were mostly firmer a day after Federal Reserve policy makers elected to hold benchmark interest rates unchanged, as expected. Favorably-viewed quarterly results from so-called mega-cap companies like Meta Platforms and Tesla supported the market.

Futures based on the S&P 500 index and the Nasdaq-100 rose 0.1% and 0.3%, respectively, near the end of overnight trading. The U.S. dollar index was little changed as the market continued to stabilize following a drop to five-week lows Monday. March WTI crude oil futures fell 16 cents to $72.46 per barrel.

What else I’m reading at www.FarmFutures.com this morning: