The U.S. Climate Prediction Center updated its La Nina outlook. According to the CPC, La Nina conditions remain present and there is a 60 percent chance these will last through April. That said, conditions are weaker than in recent years. The CPC believes there is a 65 percent chance La Nina indicators will turn neutral by the end of May. These conditions will likely linger through the remainder of the South American production season, but impacts will be less than in recent years.

NOAA was also out with its long-range U.S. weather outlooks with mostly favorable conditions expected across much of the Corn Belt. Temperatures for the Corn Belt through May are expected to be near average. Precipitation is expected to be above normal in the Eastern Corn Belt and part of the Western Corn Belt. The remainder is expected to see normal precipitation. Hopes are this will alleviate current drought conditions. The Southwestern U.S. is expected to see below normal precipitation, including the Southern Plains.

The financial institute CoBank has released its U.S. acreage estimates for the upcoming production season. CoBank is predicting U.S. corn acres of 94.55 million this coming season, a 4.35 percent increase from last year. U.S. soybean acres are estimated at 84 million, a decline of 3.55 percent. Given anecdotal reports from across the Corn Belt of regional corn seed sales increasing as much as 10 percent from last year, this shift is not hard to believe. Elevated nitrogen demand further signals a shift to more corn this year. New crop futures also continue to support corn production with a tighter than normal 2.2:1 ration to soybean values. 

Chinese officials announced that they feel the country’s pork demand has likely plateaued. A major reason for this is China’s declining population, but also from a shift to other proteins in diets, mainly more beef. China imported 1.06 mmt of pork in 2024, which was 32 percent less than in 2023. China’s 2025 pork imports are forecast to be relatively steady from 2024. China’s top pork source is Brazil, followed closely by Spain. The United States is a distant 3rd. Hog producers in China are also becoming more efficient and have increased domestic production with fewer hogs.

The Argentine government has announced it will be lifting its 50-year-old ban on live cattle exports. Argentina has long banned beef exports to ensure adequate food supplies. Argentine cattle producers claim this ban has prevented them from taking part in global market rallies and limited their income. Argentina exported 935,000 mt of beef in 2024, a 10 percent increase from 2023. This was also the country’s largest beef exports in 100 years. The lifting of this ban comes as China elevates its beef consumption and the U.S. is placing additional tariffs on beef exports.

Infrastructure has long been a problem in Brazil, and even with recent improvements, issues remain. The primary hindrance in Brazil is a lack of movement options outside of trucks. Not only does this slow deliveries to export terminals, but it is more costly. This is especially the case in years such as this where diesel costs are elevated.

Tto remedy this situation, China grain trader COFCO has announced it will be investing more in the country’s infrastructure. This includes 23 new locomotives and 979 new grain hoppers, along with improvements to Brazil’s ports. By doing this it will further benefit China’s import flow and reduce costs long term.

Recent economic data has started to have more of an impact on the commodity market from a demand outlook. Personal income made a sizable increase in January, increasing 0.9 percent from December. The street was expecting an increase of just 0.4 percent. Personal spending in January was also surprising, declining 0.5 percent from December versus estimates for a 0.1 percent increase. This indicates more consumers are putting money into savings. The January price index was up 2.5 percent from a year ago with Core prices increasing 2.6 percent. These were both equal to expectations and down slightly from December.

The greatest surprise for the market came from housing sales data. U.S. pending home sales in the United States dropped to their lowest level in history in the month of January. January home sales dipped 4.6 percent from December and 5.2 percent from January 2024. Home builders are also reporting their lowest demand in five months. Some economists are pinning the low sales on January weather, but rising mortgage rates and uncertain financial outlooks are greater factors.

Most of the South American harvest interest has been on the Brazil soybean crop, harvest is quickly advancing in Argentina as well. The Argentine corn harvest has advanced to 5.4 percent of the crop according to the Buenos Aries Grain Exchange. This is an increase of 3 percent in just the past week. The average corn harvest pace for this date is just 1.7 percent. Analysts are now questioning if this rapid harvest is from dry field conditions, or possibly that production is down from expectations.

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