Dan Flynn is the writer of The Corn & Ethanol Report, a daily market letter covering grains, energies, and various global issues that are the driving force and backbone of the commodity markets. Contact Mr. Flynn at (312) 264-4374
We kickoff the day with Export Sales, PPI MoM & YoY, Core PPI MoM & YoY, Initial Jobless Claims, Continuing Jobless Claims, Jobless Claims 4-Week Average, PPI, and PPI Ex Food, Energy, and Trade MoM & YoY at 7:00 A.M., EIA Natural Gas Storage at 9:30 A.M., 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11:00 A.M., 30-Year Mortgage Rate at 12:00 P.M., and Fed Balance Sheet at 3:30 P.M.
The February Consumer Price Index inflation rate was reported to be a little cooler than expected to 2.8%, the lowest in 3 months. While price inflation rate slowed, prices for many consumer goods reached record highs in February. The Consumer Price Index set a new all-time high of 319.08. The Food & Beverage, Foods, Meats, Housing, Medical Care, and Other Goods & Services Index all set record highs in February, as did the Core Inflation Index. The purchasing power of the US dollar continues to erode. Ag Resources (ARC) calculates the US dollar has lost 24% of its purchasing power compared to the immediate pre-pandemic months. $1 in Feb 2025 was worth just $.76 compare to the pre-pandemic months. ARC continues the dollar’s trajectory does not look to change anytime soon, which will continue to drive investor demand for real assets such as farmland, other real estate, and gold. I still believe we are moving in the right direction with the mess left to the American taxpayer. It will take time to fix this, but we are navigating correctly to right the ship.
South American Weather Pattern Discussion
South American Forecast Weather in central Brazil; Argentine Harvest Threats Absent:
South American forecast is viewed as improve as the major forecasting models agree needed rainfall sweep across Mato Grosso do Sul and Parana in Brazil’s southern safrinha belt. This area has been abnormally dry since late February. A regular pattern of moderate rainfall is needed there into April. And while much more rain is needed to fully recharge soil moisture accumulation of 1-2” is probable into the weekend. A pattern of well below normal precipitation in Argentina, Paraguay, and Rio Grande do Sul in S Brazil is forecast. The Argentine corn harvest last week was 7% harvested and should reach 9-10 harvested this week. A year ago in early March the Argentine crop was only 4% harvested. South American weather is viewed as non-threatening.
Central US Weather Update
US Precipitation to Remain Stagnant; Steady Wind Forecast in Plains/W Midwest:
The Central US forecast into March 28th remains wet in IA, MN, and east of the Mississippi River. 10-day moisture equivalent totals there are projected in a range of 1-3”, with the heaviest totals offered to TN, KY, IN, and OH. Heavy snow is probable next week in IA, SD, and into much of the Upper Midwest. Any/all precipitation is welcomed in the Dakotas, IA, MN, and WI amid current longer term drought conditions there. Limited precipitation is forecast to impact the principal HRW Belt. Wind adds to moisture loss in the next 7 days. Gusts of 20-30 + mph will be common in TX, OK, KS, and MO. A broad pattern of abnormally high wind speeds to persists into the middle of next week before calm resumes. ARC looks for an easing of Midwest drought into April 1st. Drought in the S Plains expands/intensifies.
Corn Comments & Analysis
Corn Sheds Risk Premium on Expansion of Trade War; Brazilian Cash Market Scores New Seasonal High:
CBOT corn fell sharply following Europe announcing it will place a 25% tariff on US corn – among other ag products – beginning April 1st, which on margin further complicates late spring/summer trade. Europe in crop year 24/25 has secured 97 Mil Bu corn on a known basis, vs. just 1 Mil a year ago, and Europe feed needs will be funneled to Canada & South America. Chinese, European, Canadian, and Mexican demand is at risk. Yesterday’s action was defined by renewed long liquidation and improved Brazilian forecasts are also noted. Yet, ARC recommends end users to use any retest of $4.50-$4.55, basis May, to extend medium term supply coverage. Brazil’s cash market index on Wednesday settled at $6.52/Bu. It’s critical that regular rains continue in C & N Brazil throughout the next 45 days. Expect outsized volatility to continue. CONAB reports on the Brazilian crop will be released later this morning. The Rosario Grain Exchange lowered Argentine soybean production 1 MMT’s to 46.5 MMT’s and corn crop to 44.5 MMT’s.
Have A Great Trading Day!
Contact me directly with any questions or to open a trading account at 1-888-254-5665 or dflynn@pricegroup.com
Trade Winds Keep Changing – Except Volatility. The Corn & Ethanol Report 03/13/2025
We kickoff the day with Export Sales, PPI MoM & YoY, Core PPI MoM & YoY, Initial Jobless Claims, Continuing Jobless Claims, Jobless Claims 4-Week Average, PPI, and PPI Ex Food, Energy, and Trade MoM & YoY at 7:00 A.M., EIA Natural Gas Storage at 9:30 A.M., 4-Week & 8-Week Bill Auction at 10:30 A.M., 15-Year & 30-Year Mortgage Rate at 11:00 A.M., 30-Year Mortgage Rate at 12:00 P.M., and Fed Balance Sheet at 3:30 P.M.
The February Consumer Price Index inflation rate was reported to be a little cooler than expected to 2.8%, the lowest in 3 months. While price inflation rate slowed, prices for many consumer goods reached record highs in February. The Consumer Price Index set a new all-time high of 319.08. The Food & Beverage, Foods, Meats, Housing, Medical Care, and Other Goods & Services Index all set record highs in February, as did the Core Inflation Index. The purchasing power of the US dollar continues to erode. Ag Resources (ARC) calculates the US dollar has lost 24% of its purchasing power compared to the immediate pre-pandemic months. $1 in Feb 2025 was worth just $.76 compare to the pre-pandemic months. ARC continues the dollar’s trajectory does not look to change anytime soon, which will continue to drive investor demand for real assets such as farmland, other real estate, and gold. I still believe we are moving in the right direction with the mess left to the American taxpayer. It will take time to fix this, but we are navigating correctly to right the ship.
South American Weather Pattern Discussion
South American Forecast Weather in central Brazil; Argentine Harvest Threats Absent:
South American forecast is viewed as improve as the major forecasting models agree needed rainfall sweep across Mato Grosso do Sul and Parana in Brazil’s southern safrinha belt. This area has been abnormally dry since late February. A regular pattern of moderate rainfall is needed there into April. And while much more rain is needed to fully recharge soil moisture accumulation of 1-2” is probable into the weekend. A pattern of well below normal precipitation in Argentina, Paraguay, and Rio Grande do Sul in S Brazil is forecast. The Argentine corn harvest last week was 7% harvested and should reach 9-10 harvested this week. A year ago in early March the Argentine crop was only 4% harvested. South American weather is viewed as non-threatening.
Central US Weather Update
US Precipitation to Remain Stagnant; Steady Wind Forecast in Plains/W Midwest:
The Central US forecast into March 28th remains wet in IA, MN, and east of the Mississippi River. 10-day moisture equivalent totals there are projected in a range of 1-3”, with the heaviest totals offered to TN, KY, IN, and OH. Heavy snow is probable next week in IA, SD, and into much of the Upper Midwest. Any/all precipitation is welcomed in the Dakotas, IA, MN, and WI amid current longer term drought conditions there. Limited precipitation is forecast to impact the principal HRW Belt. Wind adds to moisture loss in the next 7 days. Gusts of 20-30 + mph will be common in TX, OK, KS, and MO. A broad pattern of abnormally high wind speeds to persists into the middle of next week before calm resumes. ARC looks for an easing of Midwest drought into April 1st. Drought in the S Plains expands/intensifies.
Corn Comments & Analysis
Corn Sheds Risk Premium on Expansion of Trade War; Brazilian Cash Market Scores New Seasonal High:
CBOT corn fell sharply following Europe announcing it will place a 25% tariff on US corn – among other ag products – beginning April 1st, which on margin further complicates late spring/summer trade. Europe in crop year 24/25 has secured 97 Mil Bu corn on a known basis, vs. just 1 Mil a year ago, and Europe feed needs will be funneled to Canada & South America. Chinese, European, Canadian, and Mexican demand is at risk. Yesterday’s action was defined by renewed long liquidation and improved Brazilian forecasts are also noted. Yet, ARC recommends end users to use any retest of $4.50-$4.55, basis May, to extend medium term supply coverage. Brazil’s cash market index on Wednesday settled at $6.52/Bu. It’s critical that regular rains continue in C & N Brazil throughout the next 45 days. Expect outsized volatility to continue. CONAB reports on the Brazilian crop will be released later this morning. The Rosario Grain Exchange lowered Argentine soybean production 1 MMT’s to 46.5 MMT’s and corn crop to 44.5 MMT’s.
Have A Great Trading Day!
Contact me directly with any questions or to open a trading account at 1-888-254-5665 or dflynn@pricegroup.com
Thanks,
Questions? Ask Dan Flynn today at 312-264-4374Daniel Flynn