I’ve changed my monthly discussion of real month-end fundamentals for the various grain markets. I’m simplifying the conversation by applying the Law of Supply and Demand: Market Price is the point where the quantity demanded equals quantities available creating a market equilibrium. My take on this Law is tweaked by looking at “available supplies” rather than “total supplies”, an important distinction in the Grains sector given supplies can be held off the market in on-farm or commercial storage. If we consider the three variables in the equation (Market Price = Supply, Demand) the only one known is Market Price. Therefore, a study of Market Price is all that is needed to understand the relationship between the unknown variables of Supply and Demand.

CORN: The National Corn Index (NCI) was calculated near $4.27 at the end of February, putting available stocks-to-use (as/u) at 12.4%. The end of November saw the NCI at $4.07 with as/u of 12.8% and the February 2024 showing $4.00 and 12.9%. The US corn supply and demand situation continued to tighten over Q2 of the 2024-2025 marketing year (December through February, the winter quarter), though it is not tight. The 12.4% is neutral, with the previous 10-year average for February coming in at 12.6%. Meanwhile, the NCI priced at $4.27 put it in the lower 33% of its 10-year price distribution range based on weekly closes only.

SOYBEANS: The National Soybean Index (NSI) was calculated near $9.52 at the end of February, putting available stocks-to-use (as/u) at 17.4%. The end of November saw the NSI at $9.38 with as/u of 18.1% and the February 2024 showing $10.80 and 12.2%. The US supply and demand situation tightened this past quarter but remains much looser than what was seen a year ago. At the end of February, the US soybean as/u could be considered neutral given the previous 10-year average for February is 14.9% while the previous 10-year high is 25.7%.

SRW WHEAT: The National SRW Wheat Index (SWI) was calculated near $4.91 at the end of February, putting available stocks-to-use (as/u) at 44.9%. The end of November saw the SWI at $4.80 with as/u of 45.7% and the February 2024 showing $5.26 and 42.6%. The US SRW wheat supply and demand situation tightened during Q3 (December through February, the winter quarter) of the 2024-2025 marketing year, but is a long way from being tight. The February as/u number of 44.9% was the largest February figure going back through February 2020. The bottom line is the US SRW market is fundamentally bearish.

HRW WHEAT: The National HRW Wheat Index (HWI) was calculated near $4.97 at the end of February, putting available stocks-to-use (as/u) at 44.1%. The end of November saw the HWI at $4.73 with as/u of 45.4% and the February 2024 showing $5.41 and 41.5%. Similar to the SRW market, the US HRW wheat supply and demand situation tightened during Q3 (December through February, the winter quarter) of the 2024-2025 marketing year, but is a long way from being tight. The February as/u number of 44.1% was the second largest February figure going back through 2020, training only that year’s figure of 48.4%. The bottom line is the US HRW market remains fundamentally bearish.

HRS WHEAT: The National HRS Wheat Index (HSI) was calculated near $5.57 at the end of February, putting available stocks-to-use (as/u) at 44.2%. The end of November saw the HWI at $5.59 with as/u of 44.1% and the February 2024 showing $6.42 and 39.8%. The US HRS wheat supply and demand situation tightened slightly during Q3 (December through February, the winter quarter) of the 2024-2025 marketing year, but is not tight. The February as/u number of 44.2% is the second largest February figure going back through 2020, training only that year’s figure of 46.8%. As with winter markets, the bottom line is US HRS wheat remains fundamentally bearish.

*Note the consistency of the three wheat as/u figures at the end of February. I find that interesting.