January 28, 2020

CORN

Corn futures rebounded on Tuesday with the nearby March futures leading the charge. Technically speaking, CH held yesterday’s low before rebounding to fill the gap left from Monday’s lower open. The equity markets rebounded from sharp losses on Monday on hopes that China can control the spread of coronavirus. Today’s bounce was almost impressive considering the general fear that commodities won’t bottom until the virus has been contained. Fresh export demand was supportive for today’s bounce following the announced sale of 124,355 mt of U.S. corn sold to Mexico. Exportable cheap South American supplies seem to be finally drying up. Reportedly, the POTUS will be signing USMCA into law on Wednesday, bringing the long-awaited revision to NAFTA to completion.

SOYBEANS

Soybeans closed 2 cents lower today marking their 7th consecutive down day. China has yet to make any new soybean purchases since Phase 1 trade deal was signed. Cheaper South American beans has Brazilian soy export program red hot as shipping vessels are being nominated with soybeans that are still standing in the fields. Brazil’s soybean harvest is off to a slow start at just 4.2% harvested vs. 13% last year but still in line with average pace. Palm oil prices posted their worst drop in more than 11 years as concerns of the rapidly spreading coronavirus will reduce demand from China. Confirmed cases and death totals continue to soar as many Chinese cities attempt to curb the virus with travel restrictions keeping people from moving in and out of the mainland. Most soybeans areas across Brazil have favorable weather conditions for filling soybeans with a return to drier weather later this week. Argentina to receive less than expected rainfall than reported earlier this week.