Grains

Grain prices this morning are weaker with Mar corn -1,75 (-0.48%), Mar soybeans -3.00 (-0.30%), Mar wheat -4.25 (-0.92%). Grains on Tuesday settled mixed with Mar soybeans at a 2-month high: Mar corn -0.25 (-0.07%), Mar soybeans +10.00 (+1.00%), Mar wheat -3.25 (-0.70%). Bullish factors included (1) a weaker dollar, and (2) continued strength in soymeal prices which rose to a new 1-1/2 year high, which benefits soybean prices, on concern drought conditions will reduce soymeal production in Argentina, the world's biggest soymeal exporter. A negative for wheat is increased wheat exports from Russia, the world's biggest wheat exporter, which may further erode demand for U.S. wheat as Russia wheat exports from Jul 1-Feb 7 are up +37% y/y at 24.5 MMT. Losses in wheat were limited on drought concerns in the Great Plains that may curb U.S. winter wheat yields after data from the U.S. Drought Monitor showed 44.1% of the area was experiencing moderate drought as of Feb 6, up from 13.6% three months ago. A negative for soybeans was the action by researcher AgRural to raise their 2017/18 Brazil soybean crop estimate to a record 116.2 MMT from a Jan estimate of 114 MMT. Strong Chinese soybean demand for U.S soybeans has been a major bullish factor for soybean prices as China 2017 soybean imports rose +13.9% y/y to a record 95.54 MMT and the China National Grain and Oils Information Center estimates China 2018 soybean imports will rise +5% y/y to a record 100 MMT.