Afternoon report: Volatility has been running rampant again this week.
Grain prices lurched lower for the past two sessions, opening up some opportunities for some bargain buying and technical positioning today ahead of Thursday morning’s highly anticipated Prospective Plantings report from USDA. Corn prices firmed 1.5%, with soybeans up around 1.25%. Wheat prices fared even better, with most contracts up between 1.5% and 2% today.
It’s the second to last day of March, but the month is refusing to go out like the proverbial lamb this year. A round of severe storms is set to deliver tornadoes, damaging winds, hail and flooding across the south tonight. Areas further north could see some snow later this week as well. Later on, NOAA’s 8-to-14-day outlook predicts some seasonally dry weather building back into the Southern Plains and western Corn Belt between April 6 and April 12, with near-normal temperatures likely for most of the central U.S. during that time.
On Wall St., the Dow tilted 134 points lower in afternoon trading to 35,159 as traders awaited fresh news from Ukraine and continue to monitor highly volatile oil prices. Today, energy futures jumped higher again. Crude oil climbed 3.25% this afternoon to move back above $107 per barrel. Gasoline rose 3.5%, with diesel moving 2.25% higher. The U.S. Dollar softened moderately.
On Tuesday, commodity funds were net sellers of all major grain contracts, including corn (-17,500), soybeans (-10,000), soymeal (-9,000), soyoil (-4,000) and CBOT wheat (-15,000).
Corn
Corn pricesfirmed 1.5% on a round of technical buying and technical positioning ahead of Thursday morning’s Prospective Plantings report, when analysts will finally get to see USDA’s prognosis on 2022 corn acres in an environment of very high fertilizer prices. Spillover strength from a broad range of other commodities lent additional support today. May futures rose 12.25 cents to $7.3850, with July futures up 11.25 cents to $7.1975.
Corn basis bids jumped 15 cents higher at an Ohio elevator and firmed 1 to 3 cents higher at two Midwestern processors on Wednesday while holding steady elsewhere across the central U.S.
This week’s Prospective Plantings report from USDA is one of the agency’s most highly anticipated reports of the entire year. Be sure to tune in to Farm Futures soon after the report drops at 11 a.m. CST tomorrow morning. And then join us for a special online live event at 1 p.m. CST featuring analysis and discussion from Farm Futures grain market analyst Jacqueline Holland and executive editor Mike Wilson. Click here for additional details.
Also out tomorrow morning is USDA’s latest export report. Ahead of that release, analysts think the agency will show corn sales ranging between 23.6 million and 55.1 million bushels for the week ending March 24.
Preliminary volume estimates were for 215,008 contracts, which was less than half of Tuesday’s final count of 431,003.
Soybeans
Soybean prices found fresh bullish optimism on a new flash sale to Mexico announced this morning, and spillover strength from corn, wheat and crude oil sparked some additional technical buying today. May futures rose 22.25 cents to $16.6525, with July futures up 19.25 cents to $16.43.
Soybean basis bids were slightly mixed at two interior river terminals and firmed 9 cents higher at an Ohio elevator while holding steady elsewhere across the central U.S. on Wednesday.
Private exporters announced to USDA the sale of 4.7 million bushels of soybeans for delivery to Mexico during the 2022/23 marketing year, which begins September 1.
Prior to Thursday morning’s export report from USDA, analysts offered a wide range of trade guesses, expecting the agency to show soybean sales ranging somewhere between 14.7 million and 69.8 million bushels for the week ending March 24. Analysts also think USDA will show up to 450,000 metric tons of soymeal sales and up to 40,000 MT of soyoil sales last week.
Ahead of the next monthly USDA soybean crushing report, a group of nine analysts surveyed by Reuters offered an average trade guess that the agency will show a February crush totaling 175.2 million bushels. If realized, it would be substantially below January’s tally of 194.3 million bushels but still come in as the second-best February crush on record.
U.S. soyoil stocks through February 28 are expected to see a modest increase to 2.522 billion pounds, versus 2.500 billion pounds through January 31 and 2.306 billion pounds a year ago. USDA releases its next monthly fats and oils report after the grain markets close on Friday.
Preliminary volume estimates were for 122,632 contracts, spilling moderately below Tuesday’s final count of 184,192.
Wheat
Wheat prices found substantial gains on a round of technical buying Wednesday as traders continue to closely assess the situation in Ukraine. Russia is still bombarding the capital, Kyiv, despite insisting it would “drastically reduce” military action there. The two countries combined account for nearly one-third of all global wheat exports. May Chicago SRW futures gained 16 cents to $10.3025, May Kansas City HRW futures climbed 22.5 cents to $10.47, and May MGEX spring wheat futures rose 19 cents to $10.62.
Prior to tomorrow morning’s export report from USDA, analysts think the agency will show wheat sales ranging between 7.3 million and 29.4 million bushels for the week ending March 24.
For the week ending March 28, 32% of the Kansas winter wheat crop was in good-to-excellent condition, with 36% rated fair and 32% rated poor or very poor. More than half (52%) of the state’s topsoil moisture supplies were rated short or very short during the same period. Kansas is the No. 1 winter wheat producer in the U.S.
Ukraine’s agriculture ministry reported that the country is losing $1.5 billion per month due to blocked agriculture exports amid the ongoing Russian invasion. Because it exports the bulk of its corn and wheat supplies, Ukraine still has stocks to meet its own food needs for at least the next two years. The country is also in talks with Romania on whether it could ship exports from Romania’s Black Sea port in Constanta.
Tunisia purchased an estimated 4.6 million bushels of soft wheat and 4.6 million bushels of animal feed barley from optional origins in an international tender that closed earlier today. The grain is for shipment starting in late April.
Bangladesh issued a new international tender to purchase 1.8 million bushels of wheat from optional origins that closes April 11. A similar tender was issued last week that closes on April 4.
Taiwan purchased 1.5 million bushels of milling wheat from the United States in a tender that closed earlier today. The grain is for shipment during the second half of May.
Preliminary volume estimates were for 63,790 CBOT contracts, tracking moderately below Tuesday’s final count of 98,999.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-May
748.75
726.75
738
12.25
22-Jul
729.75
708.5
720
11.25
Soybeans
22-May
1683.75
1638.75
1664
22.25
22-Jul
1658.25
1619.5
1642.5
19.25
Soymeal $/ton
22-Jul
472.8
459
466.9
6.5
Soyoil cents/lb
22-Jul
71.25
69.37
70.68
0.7
Wheat $/bushel
22-May
1041.75
1002.25
1027.25
16
22-Jul
1037.5
996
1023
16
KC Wheat
22-May
1058.75
1014.75
1044.5
22.5
22-Jul
1058.5
1015
1044.75
22.25
MPLS Wheat
22-May
1073
1035.5
1058
19
22-Jul
1070.75
1034.25
1057.25
17.75
Live Cattle cents/lb
22-Apr
140.875
139.875
140.15
-0.75
Feeder Cattle cents/lb
22-Apr
164.05
162.65
163.825
-0.525
Lean Hogs cents/lb
22-May
118.75
116.375
117.2
-1.575
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-May
108.75
104.55
107.64
3.4
Diesel
22-Apr
3.9197
3.71
3.7985
0.0824
Unleaded Gasoline $/gallon
22-Apr
3.3304
3.2194
3.3227
0.1194
Natural Gas
22-Jun
5.677
5.326
5.622
0.241
U.S. Dollar Index
22-Jun
98.49
97.73
97.88
-0.561
Gold $/ounce
22-May
1940
1917.8
1932.6
20.4
Copper
22-Apr
748.75
726.75
738
12.25
Fertilizer Swaps
(as of 03/25)
DAP Tampa-index
1,017.5
0
DAP-New Orleans
1,102.3
19.29
Urea-New Orleans
992.1
8.82
Urea-Middle East
1,130.0
10
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
686.2
24.8
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