The EUR/USD currency pair declined to 1.0325, while the price of the US WTI light crude oil rose to $70.58 per barrel.

As expected, the Federal Reserve (FED) lowered the benchmark interest rate to a range of 4.25%–4.50% at the conclusion of its two-day meeting on Wednesday. This places the rate a full percentage point below its level in September, when the central bank began easing the strict monetary policy implemented to counter the sharp acceleration in inflation that started in 2021.

The FED now forecasts only two further quarter-point rate cuts by the end of 2025. Slower progress in reducing inflation—which, according to current projections, will not return to the 2% target until 2027—signals a slower pace of rate cuts and a slightly higher terminal rate of 3.1%, expected to be reached in 2027. This is up from the previous terminal rate of 2.9% projected in September.

Grain markets were pressured by technical sales, with traders suddenly focusing on the increasingly likely soybean production in Brazil, expected to begin in early 2025. The production is projected at 168.6 million tons. Dragged down by the soybean market, corn and wheat prices in Chicago also declined. Light snowfall and rain are expected in the Midwest. U.S. stock markets also dipped sharply, while the U.S. dollar strengthened significantly. This happened despite the anticipated interest rate cuts in the United States, reflecting a classic "buy the rumor, sell the news" scenario.

Yesterday, March wheat futures in Chicago dropped by 3 ¾ cents to $5.41 ¼ per bushel. Wheat futures in Chicago declined, while they rose in Paris, influenced by large global supplies and increasing harvest potential in Argentina and Australia. U.S. export sales of wheat are expected to range between 225,000–550,000 tons of the old crop and 0–50,000 tons of the new crop. FranceAgriMer slashed its soft wheat export potential for the current season by 10% to 3.5 million tons, down 66% compared to 2023/24. Tunisia announced a tender to purchase 100,000 tons of soft milling wheat and 100,000 tons of feed barley with delivery in January–February. South Korea issued a tender to buy 90,000 tons of milling wheat from the United States and Canada with delivery over March–April. According to France's Ministry of Agriculture, the country's soft winter wheat areas in 2025 will reach 4.51 million hectares (+8.7% compared to 2024 and -0.8% compared to the five-year average). In parts of Russia, snowfall has created a snow cover, which is good news for crops.

Yesterday, CBOT March corn futures fell by 6 ¼ cents to $4.37 ¼ per bushel. Corn futures in Chicago were weighed down by the drop in soybeans. The USDA reported a private export sale of 144,000 tons of corn to Colombia. For the week ending December 13, 2024, ethanol production in the United States reached 1.103 million barrels per day, up 25,000 barrels from the previous week. Ethanol stocks fell by 12,000 barrels to 22.636 million barrels. Exports were at 163,000 barrels per day (+40,000), while domestic consumption was 903,000 barrels per day (+20,000). Weekly export sales of U.S. corn are expected between 0.8–1.6 million tons of the old crop and 0–100,000 tons of the new 2025/26 crop. Between July 1 and December 18, 2024, Ukraine exported 19.852 million tons of grain (16.013 million tons during the same period in 2023), including 1.477 million tons in December (2.917 million last year). Wheat exports amounted to 9.307 million tons (313,000), barley exports reached 1.927 million tons (65,000), and corn exports were 8.298 million tons (1.089 million). China's state company Sinograin announced it is halting sales of imported corn from state reserves to support the domestic market while increasing purchases from local farmers.

Yesterday, Chicago January soybean futures fell by 25 cents to $9.51 ¾ per bushel. The soybean complex in Chicago declined, along with rapeseed futures in Paris and canola futures in Canada. Rainfall continues in Brazil, supporting crop growth during the vegetative stage. The Brazilian real also weakened. The USDA reported a private export sale of 120,000 tons of soymeal to Colombia. Weekly U.S. soybean export sales are expected between 0.825–2 million tons of the old crop and 0–100,000 tons of the new crop. Soymeal sales are projected at 150,000–400,000 tons, while soyoil sales are expected to range from 5,000 to 75,000 tons.