Corn Morning Update & Commentary: Tariffs on the back burner, weather to the fore?
<div class=\"default-font-wrapper\" style=\"line-height: 1;font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\">Corn Morning Update & Commentary:<br><br id=\"isPasted\">Overnight, corn futures were quietly mixed, standing in stark contrast to recently elevated volatility, finishing roughly steady by the biscuit break. The tariff issue appears heading to the back-burner; Canada/Mexico are both on hold for 30 days, and China took a measured retaliatory stance against their own 10% levies (which went into effect). The short-term focus may shift back to the weather; Argentina is due to get a nice upswing in precip the next couple of days, and the market will likely react accordingly depending upon coverage. Overall, we think South American corn production expectations are eroding, but not plunging; a good crop is overall still expected, but will ultimately hinge on Brazil’s safrinha/second crop. Export news remains quiet, though at least there was a small 8 AM flash (132k corn to Korea). Despite the tariff pause, outside markets are somewhat defensive; the dollar is selling back off, but energy is quite weak (China’s retaliation targeted U.S. energy?) and stocks are surprisingly flat.<br> <br>Monday was another ‘tariff day’ at the CBOT, including the requisite zigs and zags. Corn futures were under meaningful pressure Sunday night as 25% tariffs on Mexico appeared imminent, and then reversed decisively higher on the mid-morning 30 day reprieve. Corn finished the day 4-6 cents higher, narrowly missing an ‘outside day up’ on the daily chart but took home the consolation prize of closing two downside gaps. Funds are believed net long over 350,000 delta-adjusted corn. Cash trade was mixed. The weekly grain inspections report maintained an even keel. For the week ended Jan 30th, U.S. exporters shipped 1.252 million metric tons (mmt) of corn, little changed from the prior week’s 1.251 mmt, but nearly double the year ago week’s 0.645 mmt. Destinations were quite broad, though the top three were usual suspects Mexico, Japan, and South Korea. YTD corn inspections move to 21.75 mmt versus 16.32 mmt last year. Export news was quiet over the weekend, aside from Iran who tendered for non-U.S. origin feedstuffs (corn, barley, meal).<br> <br> <br>QT News - Top News<br> <br>**USDA reported private sale of 132,000 mt of Corn to South Korea for the 24/25 MY<br> <br> <br> <br>-- CME Group Tuesday reported its January 2025 market statistics reached 25.7 million contracts, the highest January average daily volume (ADV) on record, up 2% year-over-year. The agriculture sector saw average daily volume increase 35%, corn futures rose 60%, soy contract turnover increased 31%.<br> <br>-- Monday's USDA Grain Crushing & Co-Products: December 2024 Corn for Fuel Alcohol:473.179 mln bushels<br> <br>-- Monday's USDA Grain Crushing & Co-Products: December 2024 dry mill DDGS: 1.876 mln tons<br> <br>-- On Monday, the European Commission forecast 24/25 EU common Corn production at 59.4 mln mt, unchanged from their previous outlook; they also left their 24/25 Corn Import forecast unchanged at 19.5 mln mt<br> <br> <br> <br>Pending Tenders<br> <br>-- Pending Tender: On Monday (2/3), trade sources cited by reuters say Iran's state grain buyer set Tuesday, Feb 4th as the offer deadline in a tender seeking up to 120,000 mt of Corn. The grain is for shipment between March and April Origins accepted include the Black Sea region, Brazil, Europe, Russia and Turkey.<br> <br>-- Pending Tender: On Monday (2/3), trade sources cited by reuters say Iran's state grain buyer set Tuesday, Feb 4th as the offer deadline in a tender seeking up to 120,000 mt of Barley. The grain is for shipment between March and April Origins accepted include the Black Sea region, Brazil, Europe, Russia and Turkey.<br> <br>-- Traders on Thursday (1/30) said Jordan's state grain buyer set February 5th as the offer deadline in a tender seeking up to 120,000 mt of feed Barley. The grain is for shipment between April 1 to May 15.<br> <br> <br> <br>-- Euronext Paris March corn futures on Tuesday are trading -0.75 euros lower at 217.25 euros/mt<br> <br>-- Dalian markets remain closed on Tuesday<br><br>KJ</div>