How Long Can Soybeans Ignore "Bearish" Fundamentals??

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0:00 Thursday Row Crop Rally
3:05 Larger Brazilian Crop?
6:17 Argentina Dryness
9:57 Cattle Rally
12:38 Drought Update
15:30 S&P 500 Gains

🌽 Corn and Soybean Futures Close Higher 📈

Corn and soybean futures saw strong performances on Thursday, with the Mar25 soybean contract breaking above technical resistance on Tuesday and closing higher again on Thursday 🌱. The Mar25 corn contract also posted its best close since late June 📊. However, anecdotal reports suggest that US farmers continue to sell corn and soybeans into the rally as spreads and basis have weakened 🌽. This indicates a more balanced market despite the price gains 📉.

🇧🇷 StoneX Increases Brazil’s Soybean Crop Estimate 🌾

StoneX has raised its outlook for Brazil’s soybean crop to 171.4 million metric tons (mmt), a 3.1% increase from its previous estimate 🌱. This revision is driven by expected increases in planted acreage and improved yields 🌞. The forecasted crop would be 14.4% larger than last season's, with Brazilian soybean exports expected to rise by nearly 4% this season to 107mmt 🇧🇷. USDA has the crop pegged at 169mmt, while Conab (Brazil's government agency) estimates it at 166.2mmt. Additionally, StoneX also increased its forecast for Brazil’s corn crop to 128.6mmt 🌽.

🌞 Dry Weather Threatens Parts of Argentina’s Soybean Crop 🇦🇷

Portions of Argentina’s soybean-growing regions are likely to remain dry in the coming weeks 🌞. While areas of Cordoba and San Luis received some rainfall, Santa Fe and northern Buenos Aires remain mostly dry 🌾. The forecast calls for continued dry conditions in northern Argentina and southern Brazil, which represent a significant portion of the soybean output 🌍. Southern Brazil contributes about 30% of the country's soybean production, while the dry areas in Argentina account for 20-25% of its soybean output 🌱.

🐄 Cattle Futures Soar Amid Wintry Weather Forecast ❄️

Cattle futures surged on Thursday, reaching life-of-contract highs amid forecasts of wintry weather across the Plains 🌨️. The cash cattle market saw a rise of $2 to $3 higher than last week 📈. This rally is driven by a shortage of feeder cattle, as the US beef cowherd has fallen to its lowest level in seven decades 🐄. Resilient consumer demand has also supported cattle prices. However, there are concerns that heavy snowfall and freezing temperatures next week could affect fat cattle performance, as wintry weather last year caused fat cattle weights to decline by 3% 📉.

🌧️ USDA Weekly Drought Monitor: Precipitation Brings Relief 🌧️

The latest USDA drought monitor revealed that much of the Corn Belt received substantial precipitation last week 🌽. Some areas reported rainfall amounts ranging from 200% to 600% above normal 🌧️, leading to improved drought conditions across Ohio, Indiana, and Illinois 🌱. Slight improvements were also observed in Wisconsin and Minnesota 🌾. Precipitation was widespread across the High Plains, but rainfall was not significant enough to warrant substantial drought improvement in those areas 🌾.

📈 Stock Market Soars in 2024 🚀

The S&P 500 had an exceptional year in 2024, gaining 23.3% 📊, marking its second consecutive year with annual gains surpassing 20% 📈. This follows a 24.2% gain in 2023. The Dow Jones rose 12.9% in 2024, while the Nasdaq surged 28.6% 🚀. Several factors contributed to the strong market performance, including the growth of AI technology, Donald Trump's presidential victory, and the Federal Reserve cutting interest rates by a full percentage point 📉. Interestingly, Bitcoin outperformed the stock market, rising 119% for the year 📉.

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