JANUARY 31, 2023   

Morning Comments :
Good morning. It’s Turnaround Tuesday, at least so far as both grain and soybean futures traded lower overnight. Energy markets are also lower – natural gas futures continue to collapse as the March contract is now near $2.62 after trading above $7.50 last fall. Crude oil futures are off 75 cents and trading just above $77/barrel. The Dollar Index is stronger. The Fed is meeting today and tomorrow and is expected to announce a ¼ % increase in short term interest rates when the meeting wraps up tomorrow afternoon. The Fed is also expected to signal how many more interest rate hikes it expects to make later in 2023. Brazilian soybean premiums weakened further yesterday as full scale soybean harvesting is expected during the first half of February. Argentina will get widely scattered rains tomorrow and Thursday, followed by a ten day period of little rainfall. Extended forecasts are showing rains returning in 10 to 14 days. Tomorrow afternoon NASS will release soybean crush data for December. Analysts expect the U.S. December soy crush to come in at 188 million bu. compared to December 2021’s crush of 198 million bu. Ethanol production data for December will also be released after the market closes tomorrow. China is expected to import large quantities of Brazilian corn during 2023. Brazil’s meat companies are raising concerns about the competition reducing supplies of corn and pushing prices higher. Yesterday, soybeans rose sharply which seemed overdone with record large supplies of Brazilian soybeans soon to make their way into export markets. A lower bias for soybeans and grains looks like a good bet today. Have a good Tuesday.