Grains and Beans Lower Despite Solid Sale to China

Traders shrugged off a solid bean sale to China in the morning export report as the markets drifted in negative territory before finishing with modest losses in a boring session that featured limited holiday volume ahead of Wednesday’s last trading session of 2025. January futures contracts first notice day will also be part of Wednesday’s trade as elevators and farmers continue to roll new crop sales ahead in hopes of higher prices in the 1^stquarter of 2026. With the Chinese purchases dismissed by the market it is hard to see a demand story rallying prices in the days ahead and with China conducting military exercises in the waters around Taiwan, the tensions between the US and China may be increasing at a time where US bean exports need a more friendly environment with China.

News and Notes:

• Although the next week will dry soils and put stress on the crops in Argentina, the forecasts for rain in the 10-12-day forecasts are keeping the market from reacting very bullishly to the news. Brazil remains in great shape for 90% of the major growing areas. The window is closing for a significant weather problem in Argentina is closing quickly and with early bean harvest starting in Brazil, the weather bulls may be waiting until Brazil’s safrinha crop enters pollination in 3-4 months to trade a SA weather issue.
• The daily March bean chart is on Page 2 and shows today’s failure to bounce back over support of the 200-DMA. The trade has been completely unimpressed by the recent Chinese purchases of US beans and with a net long position of over 700 MBU by the funds, the charts are not helping convince the funds to stay on the long side. Although the market has been oversold for most of the month, the selling pressure of year-end tax selling will continue tomorrow. While there is no obvious reason to be bullish beans, they are due for a bounce and should have Brazil’s massive crop priced in at these levels.
• As rumored on Monday afternoon, China did buy US beans yesterday and it was announced this morning. Purchases of about 12 MBU brings China’s trade commitment to about 80% complete of the 440 MBU announced in the trade deal. It is strange that old crop beans rallied $1.50 on the trade deal announcement in October but have fallen $1.20 after the deadline was pushed back to late February. The difference in sales of 80-90 MBU does not justify the extent of the recent losses. The bears are selling because China is rotating out and replacing their government stocks and not increasing their actual use of beans, meal or bean oil.
• Please send me an email or a text with any update on how the paperwork and communication with the FSA offices and getting the Farmer Assistance Checks is going for you. Finding reliable information on the USDA website is futile.

Holidays breed dull markets with little news and it is hard to get a meaningful rally started without any news, especially any bullish news. With 2 trading days left in 2025, the pace will stay slow until next week and everyone comes back from their holiday breaks. EH January 12^thUSDA is the next major market moving news on the horizon.