Following a bounce in the wake of a mostly bullish USDA supply-demand update last week, Chicago corn and soybean futures have quickly refocused on South American growing conditions.
“The primary thing right now is South American weather,” said market analyst Tom Lilja of Progressive Ag in Fargo, North Dakota.
Near-term forecasts call for more heat and dryness in drought-plagued Argentina, although the longer-term outlook is for wetter conditions. The weather in Brazil has more favourable throughout the 2022-23 growing season, although southern areas are still trending drier while the early harvest in the country’s central region is being interrupted by rain.
“Argentina does continue to be the biggest concern amongst the trade,” said Lilja, noting that production estimates out of the country continue to be revised lower.
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