Afternoon report: Wheat prices face substantial cuts in Friday’s session
Grain prices were mixed overnight heading into Friday’s session but broke back into the red by the close. Wheat losses were substantial, with most contracts losing 3% to 4% today amid continued harvest pressure and spillover weakness from sharply lower crude oil prices. Corn and soybeans tested moderate overnight gains, but each commodity closed with modest losses of around 0.4% today.
Not much moisture is expected to fall in the Midwest or Plains between Saturday and Tuesday, per the latest 72-hour cumulative precipitation map from NOAA. Minnesota and the Dakotas have the best chance at seeing trace to modest amounts during this time. Meantime, NOAA’s 8-to-14-day outlook predicts seasonally dry weather lingering in the eastern Corn Belt between June 24 and June 30, with widespread hotter-than-normal conditions across the entire central U.S.
As a painful week on Wall St. draws to a close, the Dow trended 145 points higher in afternoon trading to 30,072 but is still on pace for a weekly loss of around 5%. Investors remain highly skittish over rising interest rates and historically high inflation. Energy futures suffered a major setback. Crude oil tumbled 7% lower this afternoon to $109 per barrel amid growing concerns of a possible recession. Gasoline and diesel each lost around 5%. The U.S. Dollar firmed significantly.
On Thursday, commodity funds were net buyers of corn (+10,500), soybeans (+8,500), soymeal (+5,000) and CBOT wheat (+10,500) contracts but were net sellers of soyoil (-4,500).
NOTE: Grain markets will be closed on Monday, June 20, in observance of the Juneteenth federal holiday (which commemorates the abolishment of slavery via the 13th Amendment). Be sure to come back to FarmFutures.com first thing Tuesday morning for our next round of grain market new and analysis.
Corn
Corn prices trended modestly lower on some light technical selling largely spurred by spillover weakness from wheat. Worries over abundant hot, dry weather in the Midwest kept losses mostly in check. July and September futures each dropped 3 cents to close at $7.8525 and $7.3875, respectively.
Corn basis bids were steady to mixed after rising 2 cents higher at an Iowa river terminal while sliding 3 to 5 cents lower at two other Midwestern locations on Friday.
Private exporters announced two large corn sales to USDA on Friday. The first was for 5.7 million bushels for delivery to Costa Rica during the 2022/23 marketing year, which begins September 1. The second was for 4.2 million bushels for delivery to unknown destinations during the current marketing year.
Are your crops showing signs of stress yet, or are they still holding strong? Curious as to how other farmers across the Corn Belt are faring? Why not tune in occasionally for a snapshot of how the season is progressing so far via our regularly updated Feedback from the Field feature? Click here to read the latest round of farmer anecdotes and find out how you can also participate.
Ukraine’s total grain exports are down 44% from year-ago totals during the first half of June, including 24.5 million bushels of corn and 1.8 million bushels of wheat over that period. Ukraine has struggled to ship out an increasingly large backlog of grain amid the ongoing Russian invasion but has been able to reroute some grain from sea ports to rail or river ports.
French corn quality ratings eased a point lower this past week but still remain in solid condition overall, with 87% rated in good-to-excellent condition through June 13, according to the country’s FranceAgriMer farm office. Still, some traders are concerned that overly hot conditions – especially in the southwestern part of the country – will cause further damage to this season’s crop.
“Through the registration review of neonicotinoids, the Environmental Protection Agency is currently proposing mitigations to protect non-target endangered species from harm, according to a new biological evaluation released,” reports Farm Futures policy editor Jacqui Fatka. EPA recently concluded biological evaluations for three popular neonicotinoid insecticides – clothianidin, imidacloprid and thiamethoxam. What might happen next? Click here to learn more.
Preliminary volume estimates were for 292,330 contracts, shifting slightly above Thursday’s final count of 278,224.
Soybeans
Soybean prices suffered a minor setback after following corn, wheat and crude oil lower today. But as with corn prices, today’s losses were mostly kept in check by weather-related worries as a heatwave remains parked over much of the central U.S. July futures dropped 7.5 cents to $17.02, with August futures down 6.75 cents to $16.24.
Soybean basis bids were steady to weak after falling 2 to 10 cents lower across five Midwestern locations on Friday.
China plans to auction off another 18.4 million bushels of its state reserves of imported soybeans on June 24, according to a statement from the country’s National Grain Trade Center. China has offered a series of similarly sized sales throughout 2022 to cool high prices and assist with domestic demand.
If it’s been a few days since you’ve ventured over to FarmFutures.com, our Friday feature “7 ag stories you might have missed” is a quick way to catch up on the industry’s top headlines. The latest batch of content includes stories on the disastrous heat-related cattle deaths in Kansas, an update on Ukraine’s grain exports and more. Click here to get started.
Preliminary volume estimates were for 169,017 contracts, trending moderately higher than Thursday’s final count of 136,784.
Wheat
Wheat prices tumbled 3% to 4% lower on a round of technical selling that was largely triggered by spillover weakness from crude oil, along with a strengthening U.S. Dollar. Harvest pressure created additional headwinds today. July Chicago SRW futures tumbled 45.25 cents to $10.33, July Kansas City HRW futures lost 44.25 cents to $11.0425, and July MGEX spring wheat futures dropped 37.5 cents to $11.7150.
France’s soft wheat quality ratings fell for the seventh consecutive week, according to FranceAgriMer, which reported that 65% of the crop is now rated in good-to-excellent condition through June 13. Southern parts of the country notched temperatures exceeding 100 degrees yesterday, with the hope for some cooler conditions ahead.
And in Argentina, overly dry conditions led the Buenos Aires Grains exchange to slightly lower its acreage estimate to 15.815 million acres. The group threatened to further reduce its estimate later “if the drought scenario is not reversed in the short term.” Around 47% of this season’s crop has been planted, which is running 10 points behind last year’s pace so far.
Preliminary volume estimates were for 95,751 CBOT contracts, moving slightly above Thursday’s final count of 90,380.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Jul
800
782.25
784.5
-3
22-Sep
754.25
735.5
737.75
-3
Soybeans
22-Jul
1724.5
1700.5
1702
-7.5
22-Sep
1575.25
1553.75
1554.25
-9.25
Soymeal $/ton
22-Aug
425.4
413.6
422.5
6.9
Soyoil cents/lb
22-Aug
75.05
72.17
72.26
-2.44
Wheat $/bushel
22-Jul
1083.75
1030.25
1034.25
-45.25
22-Sep
1096
1042.75
1046.75
-45.75
KC Wheat
22-Jul
1152.75
1102.5
1105
-44.25
22-Sep
1160
1109.75
1112
-44
MPLS Wheat
22-Jul
1209.25
1167.75
1169.5
-37.5
22-Sep
1210
1168.25
1170
-37.75
Live Cattle cents/lb
22-Jun
138.225
137.725
137.925
0.175
Feeder Cattle cents/lb
22-Sep
175.15
172.575
175.075
1.85
Lean Hogs cents/lb
22-Aug
108.5
106.65
107.8
1.775
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Jul
118.97
108.25
109.15
-8.44
Diesel
22-Jul
4.6444
4.2936
4.3442
-0.2271
Unleaded Gasoline $/gallon
22-Jul
3.9521
3.6432
3.7766
-0.1792
Natural Gas
22-Aug
7.566
6.852
6.924
-0.514
U.S. Dollar Index
22-Sep
104.885
103.64
104.46
1.043
Gold $/ounce
22-Jul
1851.8
1835.1
1844.9
-0.8
Copper
22-Jun
4.1
4.0155
4.022
-0.09
Fertilizer Swaps
(as of 06/17)
DAP Tampa-index
1,090.0
-15
DAP-New Orleans
887.4
24.8
Urea-New Orleans
485.0
-57.87
Urea-Middle East
635.0
-40
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
601.3
-19.29
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