By Kirk Maltais


-- Soybeans for March delivery rose 0.8% to $11.92 3/4 a bushel on the Chicago Board of Trade on Monday, with trading staying at low volumes as weather in South America looks to turn warmer, pressuring crops there.

-- Corn for March delivery rose 0.4% to $4.30 3/4 a bushel.

-- Wheat for March delivery rose 0.2% to $5.97 3/4 a bushel.


HIGHLIGHTS


Mixed Bag: The weather in Argentina and Brazil continues to influence CBOT grains. The 6- to 10-day forecast calls for some additional heat, but ample rainfall is also forecast across the board. The introduction of new heat stress provided grains support, although analysts aren't convinced that this will be a longer-term turnaround.

"You'll hear a lot of rhetoric about South American crops due to this year's volatile weather, but it only truly matters to the U.S. futures market if it impacts U.S. supplies," said Arlan Suderman of StoneX in a note.


Overlapping Events: Volumes were light in trading on the CBOT, with a convergence of events keeping traders off of the market for the day.

"Southeast Asia is closed for the Lunar New Year while South America celebrates Carnival," Daniel Flynn of Price Futures Group said in a note. "Both holidays will diminish volume along with Super Bowl casualties this Monday."

According to data from Factset, volumes traded so far in Monday's session for grains is only roughly half of the volume recorded Friday.


INSIGHT


Forecasts Ahead: Analysts are expecting the USDA in its Agricultural Forum this week to forecast 2024-25 crops to be similar in size to what was seen last year. Analysts said they are expecting smaller corn production, but still an output that exceeds 15 billion bushels.

Soybean and wheat production is expected to rise, leaving current fundamentals intact for the marketing year.

For all three, that means an extension of the pressure on grain futures, which have come on strong harvesting out of South America as well as decreased export demand for U.S. crops. That is, unless the weather throws farmers a curve ball.

"Farmers are just waiting til the spring planting season and hoping for a weather rally," Brian Hoops of Midwest Market Solutions said.


Big Picture View: The open interest in commodity futures posted a 2.6% uptick in trading for the week ended Feb. 9, JPMorgan's Global Commodities Research division says in a note, bringing open interest to a 10-week high of $1.23 trillion.

The climb can be attributed to strength seen in energy futures, with open interest there surging by $35.7 billion, while metals, agriculture and other commodities treaded water.

Volumes of commodity futures being traded on Monday, including crude oil and corn, are down from Friday's levels, according to data from Factset.


Short Flow: Fund traders added short positions in grains for the week through Feb. 6, according to the CFTC's Commitments of Traders Report released Friday afternoon.

The corn net short position for funds is now nearly 298,000 contracts, while soybeans is short over 130,000 contracts and soft red winter wheat is net short nearly 67,000 contracts. With funds adding to short positions, grains are seen as vulnerable to a new wave of short covering, although that didn't transpire Monday.


AHEAD


-- The USDA is scheduled to release its 2022 Census of Agriculture at noon EST Tuesday.

-- The EIA is due to release its weekly ethanol production and stocks report at 10:30 a.m. EST Wednesday.

-- Deere & Co. is scheduled to release its first-quarter 2024 earnings report before the stock market opens Thursday.

-- The USDA is due to hold the first day of its Annual Agricultural Outlook Forum in Arlington, Va., beginning at 8 a.m. EST Thursday.

-- The USDA is scheduled to release its weekly export sales report at 8:30 a.m. EST Thursday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

02-12-24 1534ET