Saudi price cuts, increased OPEC output weigh on crude

Recap for January 8

• US crude oil prices fell more than 3% Monday in the wake of sharp price cuts by Saudi Arabia, the top global exporter, along with increased output from Organization of Petroleum Exporting Countries, both of which more than offset supply concerns ramped up by Middle Eastern war. OPEC oil output rose last month as continued cuts by Saudi Arabia and other members of the wider OPEC+ alliance were offset by increases in Angola, Iraq and Nigeria. Angola exited OPEC on Jan. 1. The cartel plans additional production cuts this year. The February West Texas Intermediate light, sweet crude future was down $3.04, or 3.4%, to close at $70.77 per barrel. 

• Steep declines in crude oil spilled over into agricultural commodity markets Monday, sending corn futures to three-year lows and soybean futures to two-year lows. Further pressure came from technical selling and ideas South American harvests will be larger than anticipated due to beneficial rains in dry Brazilian cropping districts. Crude oil’s losses also affected wheat futures, as did the onset of snowy weather expected to increase in volume this week across the Midwest and central Plains, a potential benefit to winter wheat now dormant in dry fields. The March corn future shed 5¾¢ for a second straight session, falling Monday to a close of $4.55 per bu. Chicago March wheat shed 19¾¢ to close at $5.96¼ per bu. Kansas City March wheat dropped 12¾¢ to close at $6.15¼ per bu. Minneapolis March wheat pulled back 9½¢ to close at $7.02½ per bu. March soybeans fell 10¾¢ to close at $12.45½ per bu. March soybean meal was down 90¢ to close at $368.50 per ton. March soybean oil was up 0.18¢ to close at 47.81¢ a lb; the September future and beyond were lower.

• After a rough start to 2024, US equity indices opened the second week of the year with gains backed by rallies in large technology companies. All of the so-called Magnificent Seven companies — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla — posted gains of more than 1%. Boeing was a major exception to the Monday rally, plummeting 8% in the wake of a Boeing jet’s emergency landing after a piece of the plane flew off in mid-air. The Dow Jones Industrial Average advanced 216.9 points, or 0.58%, to close at 37,683.01. The Standard & Poor’s 500 added 66.3 points, or 1.41%, to close at 4,763.54. The Nasdaq Composite jumped 319.7 points, or 2.2%, to close at 14,843.77.

• The US dollar index declined Monday, marking a third consecutive trading day of losses. 

• US gold futures eased again Monday. The February contract fell $16.30 to close at $2,033.50 per oz.

Recap for January 5

• Soy complex and corn futures closed lower Friday and sharply lower for the week as beneficial rains fell in the dry growing areas of Brazil, the world’s largest soybean and corn exporter. US winter wheat futures were higher in technical trading and follow-through buying on gains made in Thursday’s session. The front two spring wheat contracts edged higher as well. The US dollar’s descent from three-week highs was supportive. The March corn future fell 5¾¢ to close at $4.60¾ per bu. Chicago March wheat added 2½¢ to close at $6.16 per bu. Kansas City March wheat added 2¼¢ to close at $6.28 per bu. Minneapolis March wheat edged up ¾¢ to close at $7.12 per bu; the July contract and beyond eased. March soybeans dropped 11¼¢ to close at $12.56¼ per bu. March soybean meal was down $6.80 to close at $369.40 per ton. March soybean oil fell 0.53¢ to close at 47.63¢ a lb.

• After a volatile week, US equity markets closed on a high note Friday after a Department of Labor report indicated the US economy added 216,000 jobs in December with most industries increasing employment, a larger gain than November’s 173,000 jobs, and better than forecasters were expecting. For all of 2023, employers added 2.7 million jobs, a slowdown from 4.8 million in 2022, but a better gain than in the several years preceding the COVID-19 pandemic. The Dow Jones Industrial Average added 25.77 points, or 0.07%, to close at 37,466.11. The Standard & Poor’s 500 added 8.56 points, or 0.18%, to close at 4,697.24. The Nasdaq Composite added 13.77 points, or 0.09%, to close at 14,524.07.

• US crude oil prices advanced Friday, the February West Texas Intermediate sweet crude future up $1.62 to close at $73.81 per barrel. 

• The US dollar index declined Friday for a second day after a four-session rally spanning the New Year’s Day holiday. 

• US gold futures eased Friday. The February contract fell 20¢ to close at $2,049.80 per oz.

Recap for January 4

• Wheat futures closed higher Thursday with Chicago soft red winter contracts leading the way, bouncing off one-month lows on talk that China may be seeking more US soft red winter wheat. Soybean futures declined amid rains providing relief to dry Brazilian fields and concerns about US export sales. Corn futures were slightly higher in market consolidation moves in the nearby months, mixed later. March corn futures ticked up 1¼¢ to close at $4.66½ per bu; later months were unchanged or narrowly mixed. Chicago March wheat jumped 13¼¢ to close at $6.13½ per bu. Kansas City March wheat added 4¼¢ to close at $6.25¾ per bu. Minneapolis March wheat advanced 2¾¢ to close at $7.11¼ per bu. March soybeans dropped 9½¢ to close at $12.67½ per bu. March soybean meal was down $4.20 to close at $376.20 per ton. March soybean oil fell 0.44¢ to close at 48.16¢ a lb.

• US equity markets were mixed Thursday. It was a fifth straight day of losses for the Nasdaq, which posted its worst two-day start to a year since 2005. The index was weighed down by Apple and Amazon, among others. The Dow Jones industrials index eked out another gain while the S&P 500 slipped lower. Conagra Foods and Walgreens Boots Alliance were among shares that dipped. The Dow Jones Industrial Average edged up 10.15 points, or 0.03%, to close at 37,440.34. The Standard & Poor’s 500 was down 16.13 points, or 0.34%, to close at 4,688.68. The Nasdaq Composite dropped 81.91 points, or 0.56%, to close at 14,510.30.

• US crude oil prices declined Thursday, the February W.T.I. sweet crude future was down 51¢ to close at $72.19 per barrel. 

• The US dollar index broke a four-day rally with a decline on Thursday. 

• US gold futures closed higher Thursday. The February contract added $7.20 to close at $2,050 per oz.

Recap for January 3

• The US dollar’s rise to a two-month high made export prospects for US commodities more expensive, and wheat futures were mostly lower as a result. Improved winter wheat condition ratings in the top hard red winter wheat production state of Kansas added further pressure. Buoyed by short covering but limited by Brazilian rains and weather projections, soybean futures rose Wednesday from multi-month lows. Corn futures followed Tuesday’s sell-off with short covering and technical buying, ending the day mostly unchanged. March corn futures ticked up 1½¢ to close at $4.65¼ per bu; later months were narrowly mixed but mostly higher. Chicago March wheat dropped 6½¢ to close at $6.00¼ per bu. Kansas City March wheat fell 7½¢ to close at $6.21½ per bu; furthest deferred 2025 contracts were narrowly higher. Minneapolis March wheat lost 6½¢ to close at $7.08½ per bu. March soybeans added 3½¢ to close at $12.77 per bu. March soybean meal was up 90¢ to close at $380.40 per ton. March soybean oil edged up 0.31¢ to close at 48.60¢ a lb.

• US equity markets fell Wednesday. Declines were attributed by some investors to a natural follow-up to the stock and bond rallies of late 2023. The year-opening weakness came even as fresh economic data suggested a gradual cooling of the US economy. The Institute for Supply Management said manufacturing activity fell slightly in December from the month before, though less than economists had forecast. The US Department of Labor said there were 8.8 million job openings in November, down from a recent peak of 12 million in March 2022. The Dow Jones Industrial Average fell 284.85 points, or 0.76%, to close at 37,430.19. The Standard & Poor’s 500 was down 38.02 points, or 0.8%, to close at 4,704.81. The Nasdaq Composite dropped 173.73 points, or 1.18%, to close at 14,592.21.

• The US crude oil price downtrend paused Wednesday. The February W.T.I. sweet crude future was up $2.32 to close at $72.70 per barrel. 

• The US dollar index continued higher Wednesday for a fourth consecutive trading day. 

• US gold futures on Wednesday reverted to their downside stance posted at the end of 2023. The February contract dropped $30.60 to close at $2,042.80 per oz.

Recap for January 2

• A strengthening dollar helped pull most agricultural commodity futures lower Tuesday on the inaugural trading day of 2024. Traders monitoring Black Sea supply risks sold futures, which pulled European wheat prices lower. Soybean futures were lower as northern Brazil’s rains helped improve moisture and crop conditions with forecast for more rain this week. That offset StoneX’s chop to its estimate for Brazil’s crop to 152.8 million tonnes from 161.9 million. Brazil’s soaking sent US corn futures to contract lows. March corn futures were 7½¢ lower to close at $4.63¾ per bu. Chicago March wheat dropped 21¼¢ to close at $6.06¾ per bu. Kansas City March wheat shed 13¢ to close at $6.29 per bu. Minneapolis March wheat lost 8½¢ to close at $7.15 per bu. March soybeans dropped 19½¢ to close at $12.74 per bu. March soybean meal was down $7.10 to close at $378.90 per ton. March soybean oil eased 0.05¢ to close at 47.79¢ a lb, though all subsequent months were higher.

• US equity markets were mixed Tuesday, the Dow industrials index posting another record-high close while shares of big technology firms such as Apple and Nvidia pulled the Nasdaq lower. The S&P 500 closed lower as declining tech and telecom stocks offset gains in shares of energy, health care, utilities and consumer staple companies. The Dow Jones Industrial Average added 25.5 points, or 0.07%, to close at 37,715.04. The Standard & Poor’s 500 was down 27 points, or 0.57%, to close at 4,742.83. The Nasdaq Composite dropped 245.41 points, or 1.63%, to close at 14,765.94.

• US crude oil prices continued lower at the dawn of 2024. The February W.T.I. sweet crude future was down $1.27 to close at $70.38 per barrel. 

• The US dollar index continued higher Tuesday as trading resumed. 

• US gold futures reversed their end-of-year trajectory and closed higher Tuesday. The February contract added $1.60 to close at $2,073.40 per oz.