Afternoon report: Wheat prices lightly mixed in Tuesday’s session
The winning streak for corn and soybeans continued on Tuesday as each crop enjoyed extended gains of around 0.5% to 0.75% after another round of technical buying, thanks in part to spillover strength from a broad set of other commodities and stocks today. Wheat prices didn’t follow suit, with most contracts facing moderate declines except for Kansas City HRW contracts, which firmed slightly.
Scattered showers are likely across a solid percentage of the Corn Belt between Wednesday and Saturday, but few areas can expect to see much more than 0.25″ during this time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s new 8-to-14-day outlook predicts drier-than-normal conditions for much of the central U.S. between October 11 and October 17, with seasonally warm weather likely for the western half of the country.
On Wall St., the Dow climbed another 697 points higher in afternoon trading to 30,188 and is on pace for the best two-day performance in two years. Energy futures also trended higher today, with crude oil rising around 3.5% higher this afternoon to $86 per barrel. Diesel climbed nearly 5% higher, while gasoline jumped 6.5%. The U.S. Dollar softened significantly.
On Monday, commodity funds were net buyers of corn (+1,500), soybeans (+4,000), soymeal (+2,500) and soyoil (+4,500) contracts but were net sellers of CBOT wheat (-2,000).
Corn
Corn prices extended gains after another round of technical buying on Tuesday, closing nearly 0.5% higher. December futures added 3.25 cents to $6.84, with March futures up 3 cents to $6.9050.
Corn basis bids were mostly steady to weak after dropping 5 to 17 cents lower across three Midwestern locations on Tuesday. A Nebraska elevator bucked the overall trend after moving 10 cents higher today.
Corn quality ratings showed minor changes in the week ending October 2. Although 52% is still rated in good-to-excellent condition, the split moved from 42/10 last week to 43/9. Analysts were not expecting to see any quality shifts this week. Another 27% is rated fair (unchanged from last week), with the remaining 21% rated poor or very poor (also unchanged from last week).
Physiologically, 96% of the crop is dented, up from 92% a week ago and one point behind the prior five-year average of 97%. And 75% is fully mature, up from 58% last week and identical to the prior five-year average. Harvest progress moved from 12% last week to 20% through Sunday. Analysts were generally expecting to see a bit more progress, with an average trade guess of 22%.
Per the latest data from the European Commission, EU corn imports during the 2022/23 marketing year are more than doubling last year’s pace so far, with 290.1 million bushels since the beginning of July.
Are there any silver linings to harvesting a smaller-sized crop this season? “Tighter supplies should bring stronger than normal corn and soybean basis at harvest,” according to grain market analyst Bryce Knorr. “That’s a good problem to have, but also complicates storage decisions for growers planning to hold crops into winter, and perhaps beyond.” Knorr examines several storage strategies and prospects in yesterday’s Ag Marketing IQ blog – click here to learn more.
Using satellites and ground-based stations could offer a cheaper, more transparent way to monitor carbon removal, but is it accurate? Farm Futures executive editor Mike Wilson investigated the abilities of the latest breaking technologies – click here to learn more.
Preliminary volume estimates were for 169,111 contracts, sinking moderately below Monday’s final tally of 201,839.
Soybeans
Soybean prices made moderate inroads following another round of technical buying on Tuesday. Tight domestic stocks remain in focus, but beware potential stumbling blocks that include seasonal harvest pressure and expectations for a record-breaking crop in Brazil. November and January futures each rose 9.25 cents to close at $13.8325 and $13.9325, respectively.
Soybean basis bids were steady to mixed on Tuesday, moving as much as 10 cents lower at an Ohio elevator and as much as 10 cents higher at a Nebraska processor today.
Soybean quality ratings were largely steady last week. Fifty-five percent remains in good-to-excellent condition, matching last week’s tally. Another 29% is rated fair (down one point from a week ago), with the remaining 16% rated poor or very poor (up one point from a week ago).
Physiologically, 81% of the crop is now dropping leaves. That’s behind 2021’s pace of 84% but ahead of the prior five-year average of 79%. Harvest pace is slightly ahead of analyst expectations, moving from 8% a week ago to 22% through October 2. That’s still behind 2021’s pace of 31% and the prior five-year average of 25%, however.
European Union soybean imports during the 2022/23 marketing year reached 106.6 million bushels through October 2, which is 10% below year-ago results so far. EU soymeal imports are also trending slightly below last year’s pace after reaching 3.89 million metric tons.
How are your crops looking this week? Is harvest progressing as planned? Click this link to take the survey and share updates about your farm’s crop development. Farm Futures grain market analyst Jacqueline Holland regularly reviews and uploads results to the FFTF Google MyMap, so farmers can keep current with peer anecdotes from around the country.
The latest Ag Economy Barometer readings indicate farmers are clearly concerned about rising interest rates. Respondents to the survey indicated they are less likely to make farm machinery and building purchases in the near futures. Twenty-one percent said rising interest rates is the primary reason for pushing off new investments. Click here for more findings from the latest survey.
Preliminary volume estimates were for 211,397 contracts, sliding slightly below Monday’s final count of 218,536.
Wheat
Wheat prices were mixed following some uneven technical maneuvering on Tuesday. Kansas City HRW contracts saw a bit of upside, with December futures picking up 1.5 cents to $9.9025. However, December Chicago SRW futures fell 7.25 cents to $9.0475 and December MGEX spring wheat futures dropped 4.5 cents to $9.7550.
Winter wheat plantings for the 2022/23 season moved from 31% a week ago to 40% through October 2, putting this year’s effort behind both 2021’s pace of 45% as well as the prior five-year average of 44%. Fifteen percent of the crop is now emerged, up from 9% a week ago and also behind the prior five-year average of 17%.
European Union soft wheat exports during the 2022/23 marketing year have reached 336.2 million bushels through October 2, which is trending slightly below last year’s pace so far. EU barley exports are even further behind last year’s pace, with 96.9 million bushels over the same period.
Japan issued a regular tender to purchase 3.6 million bushels of food-quality wheat from the United States and Canada that closes on Thursday. Two-thirds of the total is expected to be sourced from the U.S. The grain is for arrival by the end of January.
Tunisia issued international tenders to purchase 5.5 million bushels of soft wheat, 3.7 million bushels of durum wheat and 4.6 million bushels of animal feed barley from optional origins that close on Wednesday. The grain is for shipment between November 1 and December 15.
South Korea purchased 2.4 million bushels of animal feed wheat, likely sourced from Australia, in a private deal that closed earlier today. The grain is form shipment in February and March.
Iraq issued a tender to purchase 1.8 million bushels of milling wheat from optional origins that closes on Wednesday. The country typically buys more than the nominal amount listed, and additional shipping details were not immediately available.
Preliminary volume estimates were for 80,959 CBOT contracts, shifting slightly below Monday’s final count of 85,832.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Dec
691.5
676.5
683
3.25
23-Mar
698
683.25
690
3
Soybeans
22-Nov
1395
1371.75
1383.5
9.25
23-Jan
1404.25
1381.25
1393.5
9.25
Soymeal $/ton
22-Dec
412.3
401
401.5
-3.5
Soyoil cents/lb
22-Dec
65.65
63.27
65.02
1.7
Wheat $/bushel
22-Dec
927
897.5
903
-7.25
23-Mar
939.25
911.25
915.5
-8.75
KC Wheat
22-Dec
1011
985.5
988.75
1.5
23-Mar
1006.5
981.75
984.75
0.5
MPLS Wheat
22-Dec
997.25
973.25
976.25
-4.5
23-Mar
1001
980.25
983.75
-3.25
Live Cattle cents/lb
22-Oct
144.75
144.15
144.25
-0.075
Feeder Cattle cents/lb
22-Oct
176.775
174.725
175.325
-0.725
Lean Hogs cents/lb
22-Dec
79.15
72.975
74.55
-3.175
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Nov
86.98
83.22
86.36
2.73
Diesel
22-Oct
3.5455
3.3547
3.5175
0.1484
Unleaded Gasoline $/gallon
22-Oct
2.6888
2.5157
2.6659
0.153
Natural Gas
22-Nov
7.239
6.66
7.154
0.351
U.S. Dollar Index
22-Dec
111.825
110.02
110.055
-1.601
Gold $/ounce
22-Nov
1731.5
1699.9
1721.6
28.7
Copper
22-Oct
3.55
3.464
3.5285
0.0705
Fertilizer Swaps
(as of 09/30)
DAP Tampa-index
725.0
-25
DAP-New Orleans
832.3
-8.27
Urea-New Orleans
680.7
-22.05
Urea-Middle East
767.5
-82.5
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
578.7
0
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