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Economy, Inflation, & Interest Rate Expectations Webinar: Pricing in the New Year
Wednesday, February 21, 2024

The U.S. economy is beating expectations when it comes to jobs growth and consumer spending. The rate of inflation is slowing but remains at levels not yet warranting monetary policy easing. Join us as we discuss the current trends, risks, and possible impact on commodities.

When: Wednesday, February 21, 2024 · 11:00 a.m. · PST
Duration: 1 hour

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USDA’s Ag Outlook Forum was held Feb. 15-16 and gave the industry its first look at USDA’s ideas for 2024 acreage and 2024/25 crop supply and demand. Acreage estimates for corn, soybeans, and wheat were close to market expectations, with corn at 91.0 million acres, soybeans at 87.5 million, and wheat at 47.0 million.  

Acreage estimates in the Prospective Plantings report (Mar. 28 this year) are usually a bit different from Ag Outlook numbers but not wildly so. For example, in 2023 the Ag Outlook Forum pegged new-crop corn acreage at 91.0 million acres and the Prospective Plantings report put it at 92.0 million.

Soybean crush fell in January, below what average analysts expected. Though crush volumes reduced from December, January 2024 crush hit a record high for the month, topping 2021. The average rate for crushing soybeans daily dropped from that of November and December. Despite the reduced crush, soybean oil yield and stocks continued to increase. 

Crude canola oil production was lowered in December 2023 and the use of U.S. canola oil picked up. U.S. canola imports increased along with oil stocks.

On Friday, Feb. 16, prior to the holiday weekend, nearby world sugar futures had made modest gains, rebounding from the lower Bollinger Band after reaching one-month lows on Thursday; resistance may be near respective 20-day averages. Over the last week, #16 domestic sugar has held below 42 cents; technicals remain neutral to marginally bearish. 

The dollar index reached a three-month high earlier in the week before straying lower, back below its upper Bollinger Band. This, along with mixed fundamental and political news, helped crude oil futures reach fresh three-month highs near $79. 

The cocoa market has begun to take measures in ensuring prices of beans are not escalated beyond reason. This week, both NY cocoa and London cocoa futures retreated from the price hikes. Traders and funds relaxed on holding long positions in the market, yet the market is currently overbought. Prices are still relatively high, supported by weather challenges in production regions. 

This report summarizes a small sampling of the information available on our IQ Ingredient Intelligence platform. Further insights, statistics, analysis, and pricing information for these commodities and others are available to IQ subscribers.

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Posted by: Information Services
Our Information Services team assists our clients with understanding commodity and ingredient market dynamics. Using our extensive database of intelligence, we also produce regular commodity and commercial market publications covering supply and demand fundamentals, news alerts on events that shape the markets, and resource guides to give you a complete picture of the industries we monitor.