Morning Comments February 1, 2021

Springanhydrous

New month, will see if this recent price trend can continue. At the am pause, corn is slightly higher and beans lower, both well of their early overnight highs. Expect volatility to continue this week ahead of next USDA supply/demand report on Feb9. Private analysts will be out with projections this week and are very likely to be lower on ending stocks due to increases in exports, particularly for corn. We may see additional Chinese sales reported this week, as the April-June positions were still being inquired about going home last week. The export sales number out Thursday am will be huge on corn with all the Chinese announcements last week summed into that number. Weekly inspections will be out later this morning. 

Corn use for ethanol has been steady and is tracking pretty well vs USDA usage estimate, while the feed sector also chugs along. Certainly can’t rule out any monthly surprises, but would think that any significant changes to feed demand would await the next quarterly grain stocks report on March 31. That will be a critical report, as initial acreage estimates are out then as well. 

Managed money remains long most ag products, but they have reallocated a bit last week….have bought more corn and sold some beans. Current estimate is long over 400,000 corn contracts. 

Opening Calls:

Corn: up 2-4c

Beans: down 2-4c