Afternoon report: Corn and wheat continue to trend higher, while soybeans eased lower on Wednesday
Grain prices were mixed but mostly higher on Wednesday as traders continue to watch weather trends both in the United States and abroad, as well as the latest export trends. Corn moved modestly higher today, while wheat prices stayed in the green for the fourth consecutive session. Soybeans also tried to push higher but ultimately failed in that bid, closing with modest losses.
Variable rains will fall across much of the Corn Belt later this week, with some areas set to gather another 0.5″ to 0.75″ between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s new 8-to-14-day outlook predicts seasonally warm, dry weather for the northern half of the U.S. between August 31 and September 6.
On Wall St., the Dow tested miniscule gains of 9 points, moving to 32,918 in afternoon trading and hoping to break a three-day losing streak as investors remain focused on whether the Federal Reserve will continue its aggressive interest rate stance. Energy futures saw big swings in either direction. Crude oil firmed 1.25% to $94 per barrel, while diesel jumped more than 4% higher and gasoline tumbled 4.5% lower this afternoon. The U.S. Dollar firmed slightly.
On Tuesday, commodity funds were net buyers of all major grain contracts, including corn (+14,500), soybeans (+11,000), soymeal (+3,500), soyoil (+2,500) and CBOT wheat (+6,000).
Corn
Corn prices wobbled but ultimately stayed in the green after some net technical buying on Wednesday. Concerns over production challenges in the U.S. and especially in Europe (which is experiencing a once-in-500-years drought) have been supportive of prices in recent sessions. Today, September futures added 4.25 cents to $6.6425, while December futures picked up 1.5 cents to $6.5675.
Corn basis bids held steady across most Midwestern locations on Wednesday but did drop 5 cents lower at an Illinois river terminal and an Iowa ethanol plant today.
Prior to Thursday morning’s export report from USDA, analysts expect the agency will show corn sales ranging between 18.7 million and 39.4 million bushels for the week ending August 18.
Refinitiv Commodities Research lowered its European corn production estimates by nearly 9% to 2.374 billion bushels due to rampant hot, dry conditions. European officials have confirmed the continent is battling the worst drought in 500 years.
Brazil’s Anec estimates that the country’s corn exports will exceed 295 million bushels in August. That’s 7.3% below the association’s prior projection made a week ago.
South Korea purchased an estimated 4.7 million bushels of non-GMO corn, likely sourced from the Black Sea region, in deals that closed late last week and earlier this week. The grain is for arrival in late November.
Grain traveling the nation’s railways totaled 20,974 carloads last week. That brings cumulative totals in 2022 to 731,999 carloads, a year-over-year decline of 5.5% so far.
Preliminary volume estimates were for 344,997 contracts, sliding moderately below Tuesday’s final count of 414,821.
Soybeans
Soybean prices tested moderate overnight gains but ultimately succumbed to a round of technical selling and profit-taking today, as traders even shrugged off a huge sale to China announced this morning. September futures dropped 5.25 cents to $15.6150, with November futures down 3.25 cents to $14.5775.
Soybean basis bids were mostly steady to firm across the central U.S. on Wednesday after rising 10 to 35 cents higher at four Midwestern locations today. An Ohio elevator bucked the overall trend after fading 6 cents lower.
Private exporters announced to USDA the sale of 19.0 million bushels for delivery to China during the 2022/23 marketing year, which begins September 1.
Ahead of tomorrow morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 12.9 million and 47.8 million bushels for the week ending August 18. Analysts also expect to see soymeal sales come in between 125,000 and 475,000 metric tons, plus up to 30,000 MT of soyoil sales.
Brazil’s Anec expects the country’s soybean exports in August will reach 202.1 million bushels, which is moderately below its prior projection made a week ago. Anec also estimates that Brazilian soymeal exports will reach 1.9 million metric tons this month.
And Brazil’s Conab is now expecting the country’s 2022/23 soybean production to reach a record-breaking 5.525 billion bushels. Brazil could also reap a large corn crop this coming season, with Conab projecting a total of 4.941 billion bushels.
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Preliminary volume estimates were for 194,738 contracts, easing slightly below Tuesday’s final count of 204,104.
Wheat
Wheat prices moved higher for the fourth consecutive session, supported by general export optimism and worries over excessively hot conditions throughout much of Europe. Most contracts saw double-digit gains today. September Chicago SRW futures gained 12.5 cents to $7.9525, September Kansas City HRW futures rose 15.5 cents to $8.98, and September MGEX spring wheat futures added 8.75 cents to $9.0875.
Prior to tomorrow morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 7.3 million and 18.4 million bushels for the week ending August 18.
Ahead of a Statistics Canada crop report out Monday morning, a group of 14 traders and analysts expect the agency to show Canada’s all-wheat production at 1.249 billion bushels this season. That would be well above year-ago results, if realized, as Canada was dealing with widespread drought stress last season.
In Ukraine, analyst APK-Inform indicated that the country’s 2022 grain harvest is likely to fall between 35% and 39% from year-ago totals due to the ongoing Russian invasion. That includes an estimated wheat production of 668.7 million bushels, plus another 1.177 billion bushels of corn.
Last Friday, a group of South Korean flour mills purchased 1.8 million bushels of milling wheat from the United States, comprised of several types and for shipment in November.
Preliminary volume estimates were for 87,393 CBOT contracts, trending around 17% below Tuesday’s final count of 104,890.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Sep
675.5
655.75
665.75
4.25
22-Dec
671
650.25
657.25
1.5
Soybeans
22-Sep
1596
1553.25
1560.75
-5.25
22-Nov
1484.5
1447.5
1457
-3.25
Soymeal $/ton
22-Oct
441.5
428.3
432.8
-0.8
Soyoil cents/lb
22-Oct
68.54
66.21
66.8
-0.66
Wheat $/bushel
22-Sep
799.75
775
795
12.5
22-Dec
817.75
792.25
813.25
13.5
KC Wheat
22-Sep
906
880.5
896.25
15.5
22-Dec
899
874.5
893.25
15.5
MPLS Wheat
22-Sep
914.75
889
907.75
8.75
22-Dec
927.25
901
920
9
Live Cattle cents/lb
22-Aug
141.625
141.2
141.275
-0.35
Feeder Cattle cents/lb
22-Sep
183.85
181.5
183.575
1.125
Lean Hogs cents/lb
22-Dec
84.1
82.05
82.225
-2
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Sep
95.4
92.79
94.81
1.07
Diesel
22-Sep
4.0202
3.8101
4.0069
0.165
Unleaded Gasoline $/gallon
22-Sep
2.9493
2.76
2.805
-0.128
Natural Gas
22-Oct
9.408
9.063
9.227
0.072
U.S. Dollar Index
22-Sep
109.055
108.295
108.625
0.071
Gold $/ounce
22-Sep
1755.2
1742
1743.8
-3
Copper
22-Aug
3.66
3.655
3.66
-0.0445
Fertilizer Swaps
(as of 08/19)
DAP Tampa-index
840.0
-47.5
DAP-New Orleans
826.8
-2.76
Urea-New Orleans
617.3
-3.31
Urea-Middle East
747.5
-15
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
454.7
13.78
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