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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.

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Corn utilization is tracking along USDA’s forecast for 2023/24. During the first half of the month, exports and ethanol production were on track to make current estimates for the season (2.100 billion bushels for exports and 5.375 billion for ethanol production). Cattle on feed as of Jan. 1 totaled 14.4 million head, up 2 percent YOY, which supports USDA’s currently projected 3 percent growth in corn use for feed. 

U.S. soybeans purchased for exports were down in the week of Feb. 15, hitting a marketing year low. Sales were below the four-week average as a result of a huge cancelation of shipment by Mexico and other unknown destinations. Soybean sales to China were also down with China taking a share of 61.5 percent of U.S. total soybeans exports. 

Soybean oil futures continue to fall, currently reaching a three-year low.

The South American soybean estimate is lower this week, with Brazil’s yield not encouraging and Argentina’s weather influencing production. 

World sugar futures trended lower in the last two weeks to a test of their lower Bollinger Band and their 300-day moving averages on Friday, Feb. 23. May-24 #11 looked to close below 22 cents, and May-24 #5 approached retracement support above $610.00. May-24 #16 looked to close below its 20-day average, trading at 41.80 cents. The dollar index has now dipped to a three-week low. Crude oil moved sideways in the last week, trading above $77 on Friday. 

Cocoa supplies remain tight with unfavorable weather and disease affecting the crop in West Africa. Ghana’s estimate for 2023/24 production came out disappointing with a further decline in expected supply. The market responded with a new record high of over $6,000 per MT of cocoa beans.

May-24 KBOT HRW wheat rebounded off its recent contract low earlier in the week but could resume its half-year slide on favorable longer-term weather forecasts. May-24 MGEX HRS wheat traded Friday at a record contract low. 

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.