By Kirk Maltais


-Corn for March delivery fell 1% to $4.38 1/2 a bushel on the Chicago Board of Trade on Tuesday, dropping as traders guess that Thursday's USDA report won't tighten the supply-demand picture for corn.

-Soybeans for March delivery rose 0.3% to $12.00 1/4 a bushel.

-Wheat for March delivery rose 0.8% to $5.95 1/2 a bushel.


HIGHLIGHTS


Peak Positioning: Trading on the CBOT focused around getting ready for Thursday's Wasde report, said Karl Setzer of Consus Ag Consulting. He adds that outside of Wasde expectations--with analysts generally expecting a quiet report that won't change the fundamental picture for grains --the outlook for South American production is driving trading Tuesday. "The global corn supply is more abundant than soybeans right now which is putting pressure on corn," said Setzer.

Taking Cues: CBOT wheat rose and reversed Monday's losses on changing macro indicators, with European pricing for wheat rising. Energy markets are higher, while the U.S. dollar is lower. Meanwhile, Paris wheat prices rose, as grain prices add risk premium ahead of Thursday -- when Conab, the USDA and Statistics Canada all release fresh monthly data that will show supply and demand volumes.


INSIGHT


Push for Peace: U.S. Secretary of State Anthony Blinken is in the Middle East this week, attempting to broker a peace deal between Israel and Gaza. Should such a deal be reached, then volatility seen on commodity markets in recent months may ease, said Mike Castle of StoneX in a note. "Commodity markets would likely breathe a sigh of relief if a deal were to be reached, as tensions have grown more and more widespread in the region since the war's outbreak, leading to major disruptions in shipping through the Suez Canal and Red Sea," said Castle. Iran-backed Houthi rebel attacks on commercial vessels in the Red Sea, and subsequent U.S. led retaliatory strikes have put stress on commodity prices globally.

Darkening Skies: Optimism among farmers is under pressure, as crop futures have fallen in recent months. The Ag Barometer, which is an index produced by Purdue University and the CME Group, showed a drop in January, which is being attributed to these lower prices. "The number of producers pointing to lower commodity prices and lower farm income in 2024 significantly influenced the decline across all indices," said James Mintert, director of Purdue University's Center for Commercial Agriculture.


AHEAD


-The EIA will release its weekly ethanol production and stocks report at 10:30 a.m. ET Wednesday.

-The USDA will release its weekly export sales report at 8:30 a.m. ET Thursday.

-The USDA will release its monthly World Supply and Demand Estimates report at noon ET Thursday.


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

(END) Dow Jones Newswires

02-06-24 1458ET