• HEADLINES: Markets lower at midday; NOPA crush record for Dec but slightly below trade guesses.

• Chicago futures are mostly lower at midday with corn, soybeans and wheat enduring profit taking ahead of the 3-day US weekend. Chicago will be closed on Monday for the Martin Luther King Holiday. The volume of Chicago trade has tailed off as China and Europe are enjoying their weekends. Chicago reopens Monday evening for the Tuesday trading session.

• Bullish traders are citing political/market risks and have been banking windfall gains. This has produced the moderate correction. For the week, Chicago soybeans are up around 45 cents, corn is up 35 cents, and wheat is up 27 cents. All have set new 6 to 7 year highs. The need for demand rationing is being maintained with ongoing strong demand. We look for a weaker to mixed Chicago close as the market had become overbought and needed a correction. However, there is no evidence that a seasonal high has been set or that demand rationing has started. Any break will likely be modest and short lived.

• Chicago brokers report that funds have sold 7,600 contracts of soyoil, 4,900 contracts of corn, and 6,400 contracts of soybeans. Funds have been modest buyers of soymeal of 1,200 contracts. We note that the decline in soyoil is based on the 2 day weakness in palmoil.

• Russia is expected to quickly sign/confirm a €uro50/mt ($1.65/bu) export duty that would start on March 1. The big question is which world wheat exporter is going to step in to fill lost Russian sales, and how will world wheat export managers manage the hefty Russian tax. We doubt that any Russian wheat exporter will offer wheat to Turkey in the weekend tender or to Jordan for shipment dates this summer. Russian sources maintain that Russia will roll forward their old crop tax and make it variable next summer. The reason is that this will prod the Russian farmer to sell old crop stocks. Russian farmers have not wanted to sell cash wheat into a declining domestic market.

• We believe that 7-9 million mt of Russian wheat may not be sold/exported due the €50/mt tax from March through June. The big question (repeated) is which major world exporter is going to step forward and fill this demand. USDA estimates that Russia was going to export 39 million mt of wheat. Most commercials now estimate that total to be lower around 31-33 million mt with that demand likely to be pushed elsewhere, maybe to North America. The US wheat could be the big benefactor with Canada, Australia, Argentina and the EU having largely sold their old crop stocks. And the only way for EU/Black Sea exporter operators can manage their forward market risk is to secure Chicago or KC wheat futures. This will at least assure today’s price.

• NOPA-member soybean crush in December totalled 183.2 million bu, below the trade’s guess of 185 million bu another record for the month. Sep-Dec NOPA crush sits at 711 million bu, up 7% from the last year. The USDA even following its upward revision this week projects US soy crush to expand just 2% year on year.

• The midday GFS weather forecast is drier in Central/Southern Argentina but otherwise consistent. Meaningful precipitation in Argentina over the next few days will be north of major crop producing areas. Complete dryness returns for an extended 7-8 days with warming temperatures. High temperatures will reach the 90′s to lower 100′s late next week across Argentina. The combination of heat/dryness will return crop stress/lower crop ratings.

• The models are mixed on whether Argentine/S Brazilian rain returns in the closing days of January. The often more correct EU ensemble model maintains a rather dry climate for Argentina and S Brazil which follows the La Niña weather pattern that has been in place for months. Research does not see any significant changes in the ENSO pattern for the equatorial Pacific

• Wheat prices are reacting to “sell the fact” trading amid Russia’s €50/mt export duty. We doubts that KC March wheat futures will fall too far below $6.35 as world importers reach for US wheat. KC wheat now has a new demand driver which could push spot futures to $7.50-8.00. Do not become bearish wheat is our message. Corn and soy demand bull stories are unchanged and higher prices are needed looking forward to February.

• HEADLINES: Morning weakness finds huge buying interest; corn, soy export sales larger than expected.

• Chicago futures are higher at midday with the grains pacing the advance. This is the last day of the Index Fund Rebalance, which has come and gone, without much of a bearish influence on Chicago. Active volume/selling has been noted during the past 4 days near the close, but bullish fundamentals and the after-effects of the USDA January crop report has lifted Chicago valuations.

• Also, the Index Fund rebalance showed that fresh money is coming into the raw material space which has moderated the rebalance selling. The flow of funds is into Chicago, and a host of other commodity markets. This will provide support on corrections. We look for a firm Chicago close with additional gains to be posted on Friday, ahead of a long 3-day US weekend with the Martin Luther King holiday being on Monday.

• Chicago brokers report that funds have bought 4,500 contracts of corn and 3,100 contracts of soybeans, while being flat in wheat (sellers overnight and buyers in the day session). Funds also sold 4,500 contracts of soyoil while buying 3,200 contracts of soymeal. We hear that there was active cash connected buying of soyoil on the morning dip. End users appear to be willing to use breaks to add to their cash market length across Chicago. Funds are holding sizeable longs in Chicago, but their sell stops are well below the market.

• Other than bouts of profit taking, we are unsure of what would push the heavily long funds to sell their Chicago market length. Key moving averages are well below the marketplace, and fund managers have been constantly rewarded with higher prices/expanding profit margins. Funds are likely to keep pushing the market higher until the cash/futures push back.

• The weekly US export sales report for the week ending January 7 showed new US sales of 8.2 million bu of wheat, 56.6 million bu of corn, and 33.4 million bu of soybeans. The corn/soybean sales were above market expectations.

• For their respective crop years to date, the US has sold 774 million bu of wheat, (up 54 million or 7.5%), 1,787 million bu of corn (up 1,027 million or 135%), and 2,046 million bu of US soybeans (up 929 million or 83%). In recent days, FAS announced new daily soybean sales amount to another 27 million bu which takes crop year sales to 2,073 million bu, 93% of the annual USDA forecast. Research maintains that WASDE is understating US soybean exports by 100-150 million bu. The problem is that the US does not have the soybeans to sell without demand rationing of the crush industry.

• According to the news agency Reuters, the EPA is going to propose on Friday that it further extend the deadlines for US energy refiners to prove that they have complied with the US’s biofuel laws. Refiners each year must hand in credits to EPA to prove they have complied. But the EPA has delayed this process by more than year which angers the US Biofuel industry.

• NOPA will release their December Member Crush Report on Friday. The report is expected to produce a record crush rate and decline in US soyoil stocks. The report will be released at 11 AM CT on Friday.

• The midday GFS weather forecast is drier in Buenos Aire but otherwise consistent with prior output. Meaningful precipitation in Argentina over the next 3-4 days will be mostly north of major crop producing areas. Complete dryness resumes in Argentina throughout the 5-10 day period. The GFS forecast maintains that temperatures in Argentina begin to reach into the low 90s in late Jan as soil moisture retreats.

• A more regular pattern of showers is forecast in Brazil. Close attention must be paid to whether this rain gets pulled into nearby period though.

• Market performance continues to show that even modest breaks only work to boost buying interest. This bull market is structural in nature as corn even at current prices remains the world’s cheapest feedgrain and as record world soybean demand is absorbing the US crop too quickly. Higher prices are needed to maintain adequate domestic stocks.

• HEADLINES: Midwest cash corn movement best since 2020 harvest: Funds bank profits after reopening; Russia & NOPA on tap.

• The USDA January Crop Report has passed, and the entire world has now been able to react to its bullish data. This produced a short-term hangover as the market awaits new evidence that higher prices are rationing demand. Demand led bull markets often consolidate large gains for a few days before pushing to new highs. This appears to be occurring at midday with diminished volume and long profit taking producing a mixed midday trade. We now look for a mixed Chicago close with a turn to higher prices into the weekend. NOPA will be out with its December soybean crush data on Friday (expected to be record large) while the Russians are expected to raise duties on wheat, corn and barley exports from mid-February onward before the weekend. Remember the old trader’s adage, “The trend is your friend”.

• Chicago brokers report that fund managers have sold 9,400 contracts of corn, 10,400 contacts of soybeans, and 4,100 contracts of wheat. In soy products, funds have sold 4,200 contracts of soymeal and 3,100 contracts of soyoil.

• Cash corn movement increased sharply along with a few soybeans from US farmers. It is the first significant cash movement in 2021 as farmers are see cash corn bids exceeding $5.00. Moreover, farmers are also selling new crop corn/soybeans based on profitable margins. This capped the early Chicago rally.

• Questions are being asked about new crop 2021 sales and it always makes economic sense to sell a modest portion of new crop corn/soybean crops at multi year highs. But research is nearly as bullish for new crop as it is for old crop and Chicago can have corrections on profit taking, but a lasting bearish trend is unlikely until above trendline yields can be confirmed in mid-summer. We are forecasting 2021/22 US soybean end stocks at just 99 million bu and corn at 1,285 million bu with increased acres and trendline yield. The point is that the current Chicago rally appears to be a multiyear bull market, not a one and done.

• The Russian Government is likely to release a more restrictive export policy in the next couple of days following meetings between traders and the ag ministry and then the ag/economic ministers. The result will be a rising duty structure that extends into new crop. And Russian corn, barley/sunseed and sunoil appear to be included in the duty plans to cap raising domestic food inflation. The news could spur another rally leg in world and US wheat prices.

• US ethanol production rose to 277 million gallons, up 2 million gallons from last week, but down 14% from last year. US ethanol stocks rose to 996 million gallons up 3% on last year. The data was supportive to US corn demand.

• The midday GFS weather forecast is drier for Argentina and Southern Brazil compared to what was offered overnight. A front will cross Argentina on Thursday/Friday producing 0.1-0.85″ of rain before a lengthy period of dry weather follows. Near to above normal rainfall will drop across N and C Brazil which will help restore lost soil moisture.

• Amid La Niña, the coming weather worry is below normal Argentine and Southern Brazilian rainfall. The lack of rain will deepen the drought that prevails. And Argentine and S Brazilian temperatures look to warm to the 90′s to lower 100′s next Tuesday. Crop stress will return again to build next week.

• Chicago is holding reasonably well following a 40-cent corn rally in less than 24 hours amid large cash corn sales that are occurring across the W and C Midwest. Corn is easily absorbing the best cash movement since the autumn 2020 harvest. The USDA announced the sale of 400,000 mt of US soybeans to an unknown buyer with just 68,000 mt in new crop. We hear that this is new China buying for February with additional interest noted on the morning price break. S American selling is limited, and once US farm selling slows, the Chicago rally will resume. Additional weakness will be modest in our opinion.

• HEADLINES: Chicago corn limit bid on US corn production fall of 325 million bu; Chicago soybean demand rationing rally to deepen.

• The USDA January Crop Reports are bullish with corn futures rising the 25-cent limit in midday trade. Both US 2020 corn/soybean yields fell further than expected with the 2020 US corn yield down 3.8 bushels/acre for a production fall of 325 million bu of production. The 2020 US soybean yield fell another 0.5 million bu to 50.2 bushels/acre for a production loss of 35 million bu. The loss of both corn and soybean production make the coming rationing rally more important.

• Moreover, US December 1 corn stocks came out close to last year’s 11,322 million bu. Such stocks argue for a feed/residual Sept-December estimate of a record large 2,737 million bu. The December corn stocks were 320 million bu below trade expectations and considered bullish. The record corn feed use makes the WASDE cut in US feed/residual use of 50 million bu difficult to understand. The crop was reduced 325 million bu, but Research would have held their stocks estimate stable.

• WASDE also adjusted downward its US 2020/21 corn export estimate by 100 million bu to 2,550 million bu.

US End Stocks (million bu)

December    January

2019/20    2020/21    2020/21

Corn            1,995        1,702        1,552

Soybeans        523        175        140

Wheat            1,028        862        836

• The WASDE US corn export cut is difficult to agree amid both the Argentine and the Brazilian corn crops in decline. WASDE cut their Brazilian corn crop by 1 million mt to 109 million with the Argentine crop cut to 1.5 million to 47.5 million mt.

• We would note that there are numerous S American private crop estimates that place the Brazilian corn crop at 101-104 million mt and Argentina at 40-44 million mt. The point is that without a dramatic reversal in S American weather, US 2020/21 corn exports will be expanding (not contracting per WASDE) due to the US being the only competitive source of feedgrain supplies.

• US corn end stocks of 1,552 million bu represent a stocks/use ratio of 10.6% which would model out to a March futures price high of $5.30. However, if China secures additional US corn or the lower WASDE feed/residual use rate is incorrect, much higher prices are likely. We see the 2020/21 US corn end stocks total at 1,200-1,250 million bu which raises the upside price potential to $5.50-6.00. We would expect that corn values are going to be extremely sensitive to S American weather and 2021 US corn seeding expectations and intentions.

• WASDE 2020/21 soybean stocks were lowered to 140 million bu, close to pipeline at 115-130 million bu. This means that the market has a considerable amount of demand rationing yet to accomplish.

• The loss of 35 million bu of 2020 US soybean production combined with a 5 million bu increase in crush and 30 million bu rise in US soybean exports was offset by a 20 million bu gain in imports and 13 million bu cut in the residual.

World End Stocks (million mt)

December    January

2019/20    2020/21    2020/21

Corn            303.4        289.0        283.8

Soybeans        95.5        85.6        84.3

Wheat            300.6        316.5        313.2

• WASDE left the Brazilian soybean crop estimate unchanged at 133 million mt despite some of the worst spring weather in 40 years. WASDE appears to be willing to wait for harvest data from Mato Grosso and Goias in coming weeks to make the needed yield/production cut. We put the Brazilian soybean crop at 128 million mt with Argentina at 44-46 million. The drop in S American production mandates additional US export demand and price rationing. We would forecast 2020/21 US soybean exports at 2,325 million bu, a 95 million bu increase from WASDE.

• We estimate that US soybean stocks will be totally exhausted with much higher prices needed to ration supply. This would become a difficult task if S American crop estimates decline during February and March.

• WASDE forecast 2020/21 US wheat end stocks at 836 million bu, a decline of 26 million bu. The drop was based on an increase of feed/residual of 25 million bu and a 1 million bu increase in seed use. Research argues that US 2020/21 wheat exports are understated by 25-40 million bu which would pull US wheat stocks closer to 800 million bu. US HRW wheat was close to pricing into the GASC tender this morning.

• 2020/21 world wheat stocks were trimmed by 3.3 million mt to 313.2 million. The key for wheat prices going forward is Russia and the potential for a hike in their export duty that could last into the new crop year. We should know the Russian grain export position later this week.

• US corn and soybean demand rationing will become more acute in the weeks ahead. The market’s sensitivity to China buying of US corn/soybeans will be increasing. US Corn nor soybean prices can allow China to book additional large US tonnages. We remain bullish with a Chicago downtrend unlikely until Northern Hemisphere crops are seeded in May/June.

• HEADLINES: Chicago trying to recover at midday after morning profit taking: China buys US summer soybeans; Midday weather late.

• Rounds of profit-taking is the Chicago theme this morning with corn/soy and wheat futures under pressure at midday. The bulls have scored massive profits since the December WASDE report and wanted to “nail down” a modest portion of those gains amid the uncertainty of the final January Crop/December Stocks reports. That selling has pressure Chicago futures following the higher overnight trade with end user pricing from commercials noted on the morning break.

• The January USDA crop report requires “seat belts & air bags” amid the likely sizeable market swings that will occur following its release. And world traders will keep the volatility going on Wednesday as Asia and Europe get their chance to trade the USDA data for the first time. The report won’t change the outlook for building global demand for US corn, soybeans and wheat, but it will determine the amount/duration of demand rationing that is needed.

• Brokers report that managed money has sold 3,000 contracts of wheat, 5,500 contracts of corn, and 10,500 contracts of soybeans. In soy products, funds have sold 4,400 contracts of soyoil and 3,900 contracts of soymeal. The soybean selling was large, but Friday’s low was not exceeded.

• The USDA announced the sale of 132,000 mt US soybeans for the 2020/21 crop year to China (which followed the sale of 204,000 mt on Friday). China is said to be bidding for additional July/August US soybeans, and will be buying Chicago futures if the USDA report comes out bearish on Tuesday. China in the international crop year to date (October-September) has shipped 4.1 million mt more soybeans than last year, a 17% increase. We note that the USDA is forecasting that China will take just 1.4 million mt more than the entire 2019/20 crop year. The USDA’s 2020/21 China soybean import estimate is too low by 4-5 million mt in our view!

• The US exported 44.5 million bu of corn, 65.4 million bu of soybeans, and 10.3 million bu of wheat in the week ending January 7. The corn and soybean export estimates were above trade expectations. And USDA raised last week’s US soybean export estimate to 64.7 million bu (from 48 million, a 20.7 million bu increase or 43%). Based on vessel counts, Research expects that next week’s FGIS US soybean export total will be revised up 10-15 million bu. China exported 30 million bu of US soybeans in the week ending January 7 or 60.5% of the total.

• For their respective crop years to date, the US has shipped a record 1,416 million bu of soybeans (up 614 million or 76%), 587 million bu of corn (up 248 million or 73%), and 546 million bu of wheat (unchanged from last year). The US soybean export estimate is remarkable since it already accounts for 85% of last year’s entire soybean export estimate, with 8 months remaining in the crop year. To achieve the USDA annual export forecast of 2,200 million bu requires an average export pace of 24 million bu/week. We expect a weekly average closer to 29 million.

• Argentine farmers are highly disappointed with the Ag Ministry’s offer of 30,000 mt of new corn export sales registrations per day. They call the offer paltry and are said to be planning the continuance of their sales strike. They are trying to return to talks to inform the Argentine Ag Minister of their disappointment. However, calculations suggests that the Argentine cash longs will be let out of their position with the new 30,000 mt sale total.

• The midday S American GFS weather forecast has been delayed due to computer issues. The forecast run is out to 120 hours (5 days) and shows no change from the overnight solution. The big question is one of how long the Argentine dryness will last beyond January 21.

• Historically, the worst of Argentine/S Brazilian droughts occur after the middle of January as they seasonally persist into March or April. The recent rains are a help to crop condition stabilisation, but there is no evidence of a pattern change. A second round of rain occurs across N Brazil on Thursday/Friday.

• The USDA report looms, but there is no sign of needed demand rationing for US soybeans or corn. Demand led bull markets often peak with a panic rally that evokes fear. The demand bull market is likely to persist.

• HEADLINES: Soybeans push to another contract high; Midday weather forecast has Argentine rains further north; Rebalance at tonight’s close.

• Midday Chicago soybean/corn futures are higher with wheat holding in the red. Early selling was based on the fear of the index fund rebalance and that includes the selling of Chicago futures and buying energies to rebalance commodity allocations on the close over the next 5 days. Traders are looking for selling pressure, but it is unknown how much new investment is pouring into the raw material space. Normally, these index fund traders not only rebalance, but also put new money to work. The new investment helps mollify the rebalance selling pressure. Watch the Chicago close as a measure of what will be occurring over the four trading days on the rebalance programs from index funds.

• We have been asked if there is any fresh news that pushed soybean/soymeal futures to new contract highs this morning. We know of no specific bull news that spurred the +20-cent rally in March soybeans. Buying of 6,000 contracts in 90 seconds lifted March soybeans to a new contract high of $13.86. Soybean futures have come off their highs but are able onto hold double digit gains at midday. The soybean rally has pulled corn and wheat futures higher. The next upside price target is $14.00 in March soybeans and $5.10 in March corn.

• The point of this week’s strong soybean rally is a lack of selling resting above the market amid the hefty sales position of US and S American farmers. Any cash connected hedge selling in Chicago futures will be limited. Some are questioning whether Brazilian farmers will start to default on sales that were made at $9.00 or lower against March soybean futures.

• The USDA announced the sale of 204,000 mt US soybeans for the 2020/21 crop year to China. We hear that the sales are for July/August and that China has additional interest working which includes US corn. In total, it is reported that China has booked 7-9 cargoes of US soybeans for July-August so far. The new demand will likely push China to import 40-41 million mt of US soybeans in 2020/21

• Research was expecting that the US would be a net importer of Brazilian soybeans during the late summer to avert negative US old crop end stocks. Now that China is securing US soybeans for late summer, it is exacerbating the extreme US soybean supply tightness. If China books 2 million mt of US soybeans for late summer, US 2020/21 soybean exports will exceed 2,425 million bu, some 225 million above the December USDA forecast. This just can’t happen with the market needing to reach higher and higher prices to ration. Brazil is offering FOB August soybeans at a hefty $1.47 over at midday.

• Tuesday’s January USDA report is going to produce acute market volatility. An update on US 2020 production, December 1 Stocks and US winter wheat seeding estimates will combine to jolt Chicago sharply. The market volatility that was seen this week will likely be more extreme on Tuesday. The report will offer longer term direction with end users hoping for a bearish report to extend their forward coverage. (Remember, hope is NOT a sensible strategy!) A bullish USDA report would produce a quick run at $14.50-15.00 March soybeans and $5.25-5.50 March corn.

• The midday S American GFS weather forecast is further north with Argentine rainfall early next week. The forecast offers needed +1.00″ rain for Northern Santa Fe and Corrientes while other provinces to pick up 0.1-0.8″. Such rain is not enough to replace lost soil moisture and regular rainfall is required into March. There is a second chance of rain offered in the 7-8 day period holding less rain of 0.1-o.75″. A drier and warmer period follows longer term. Near to below normal rain falls across N and W Brazil into Jan 20. The S Brazil/ Argentine forecast stays concerning.

• New Chinese demand for US soybeans cannot continue or the US will run out. Price rationing is needed and not yet occurring. Corn will follow soy to the upside on record high Chinese corn values as their hog herd rapidly expands. The Chicago bull market will continue, it is just a question of speed and degree which will !be determined by the USDA January Report.

• HEADLINES: Chicago retreats after bull run; market holding better than bears expected; China bidding for US July/August soybeans.

• Chicago soybean/corn/wheat futures are taking a pause from their recent rally on profit taking ahead of Tuesday’s USDA January Crop Report. The Chicago correction was needed following a nonstop rally that started in late 2020 with March soybeans racing to $13.73 (highest price in 7 years) yesterday.

• Today’s weaker Chicago trade is being called a correction as US demand stays strong. FAS reported new buying of US 2020/21 soybeans emerging from an unknown destination (rumoured to be China). The US cannot afford to sell additional soybeans to China with their 2020/21 annual purchase pace estimated 36 million mt (1,323 million bu) on a known/unknown basis. China has already exported a record 27.3 million mt with an estimated 8.8 million mt of US soybeans left to ship. China is exporting 1.1-1.4 million mt of US soybeans weekly which will exhaust their purchase commitments by March. Chicago soy must reach prices that ration this demand.

• Chicago corn/wheat markets are following the weakness in soy. Here too, both grains required a correction following the recent nonstop rallies.

• Chicago brokers estimate that funds have sold 3,500 contracts of wheat, 6,900 contracts of corn and 9,500 contracts of soybeans.

• The USDA announced the sale of 213,000 mt US soybeans for the 2020/21 crop year and 130,000 mt for 2021/22 to unknown buyers. Both sales are rumoured to be to China with the old crop sale shipping in the July/August timeframe. We understand that China is working additional cargoes in July/August due to the sharp rise in Brazilian fob premiums. Brazil is offering soybeans for June at $0.70 over, with July at $0.85 over, and August at $1.30 over. The US Gulf is competitive in the July/August timeframe which is why China is taking additional US old crop soybeans. Research argues that China will secure a at least a record 40 million mt of US soybeans in 2020/21, or 1,475 million bu. This massive purchase pace by China suggests a US 2020/21 soybean export pace of 2,375 million bu or 175 million bu above the December WASDE forecast.

• For the week ending December 31 US export sales were; 10.1 million bu of wheat, 29.5 million bu of corn, and a marketing year low of 1.4 million bu of soybeans. For their respective crop years to date, the US has sold 765.7 million bu of wheat (up 70 million or 10%), 1,730 million bu of corn (up 1,001 million or up 137%), and 2,012 million bu of soybeans (up 918 million or 84%). This was a holiday week and the slower than expected US corn and soybean sales are not a developing trend as far as we are concerned.

• The US Census Bureau reported that the US exported a record a record 408 million bu of soybeans in November (record US soybean exports of 1,115 million bu for Sept 1-Nov 30). The US has exported record monthly amounts of soybeans since September and will include December. US November corn exports were 150.5 million bu with wheat at 69.6 million bu. Both were slightly above FGIS (Federal Grain Inspection Service) November estimates.

• The Argentine Grain Inspectors Union ended their month-long strike. Private inspectors were helping in the certification of cargoes, but following recent wage hikes, everyone along the Argentine food chain will be seeking a higher wage amid growing domestic inflationary pressures.

• Chicago reported an EFR for 10,000 contracts of November soybeans today. This takes the running total since late December to 47,000 contracts or some 6.4 million mt of soybeans. Research suspects this is China bidding for US new crop soybeans on a swap program.

• The S American GFS midday weather forecast is drier for Argentina with the two storm systems being weaker and more in line with the overnight EU model. The midday GFS prints out rains of 0.4-1.25″ with locally heavier totals between January 12-14. A second chance of rain is offered in the 9-12 day period holds less rain of 0.15-0.75″. A drier and warmer period follows longer term. Near to below normal rain falls across N Brazil into Jan 20. The S Brazilian/Argentine forecast is concerning.

• Corrections are needed/normal in any demand led bull. We stay bullish on weakness.