Afternoon report: Corn also firm in Thursday’s session, while soybeans slide slightly lower
Grain prices were mixed but mostly higher on Thursday. Wheat prices saw the biggest gains after rising 1% to 1.25% higher on worries that a current Black Sea shipping deal won’t be renewed (more on that below). Corn also moved moderately higher, capturing gains of around 0.7%. Soybeans failed to follow suit, easing slightly lower amid ongoing harvest pressure and expectations for bin-busting crops in South America.
A band of rains stretching from California all the way through Virginia will make its way across the country between Friday and Monday, per the latest 72-hour cumulative precipitation map from NOAA. Portions of the Great Lakes region will also see some measurable moisture, while other parts of the Corn Belt should remain dry during this time. NOAA’s new 8-to-14-day outlook predicts a return to seasonally warm, dry weather across the central U.S. between October 20 and October 26.
Is rainy weather slowing down fieldwork this week, or 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.
On Wall St., the Dow jumped 758 points higher in afternoon trading to 29,969 after the consumer price index (a major inflation indicator) didn’t rise as much as expected. Energy futures moved higher, due partly to lower diesel inventories. Crude oil was up 2.25% this afternoon, cresting back above $89 per barrel. Diesel prices climbed 4.25% higher, with gasoline up around 2.5%. The U.S. Dollar softened moderately.
On Wednesday, commodity funds were net buyers of soybeans (+8,000) and soymeal (+3,500) contracts but were net sellers of corn (-500) and CBOT wheat (-6,000). Funds were roughly even when trading soyoil contracts yesterday.
Corn
Corn prices followed wheat higher on some technical buying as traders continued to assess USDA’s October World Agricultural Supply and Demand Estimates (WASDE) report, as well as some fresh unfolding challenges in the Black Sea region. December and March futures each added 4.75 cents to reach $6.9775 and $7.0475, respectively.
Corn basis bids were mostly steady to weak after tumbling as much as 25 cents at an Indiana ethanol plant and softening 2 to 5 cents at three other Midwestern locations on Thursday. An Iowa ethanol plant bucked the overall trend after tracking 2 cents higher today.
Did you miss yesterday’s market-moving WASDE report? Click here to catch up on what happened and read exclusive commentary from Farm Futures grain market analyst Jacqueline Holland.
Ahead of Friday morning’s export report from USDA, analysts expect to see corn sales ranging between 11.8 million and 35.4 million bushels for the week ending October 6.
Fertilizer costs aren’t likely to go down anytime soon, which begs the question – what are the best ways to get the most bang for your nitrogen buck? Farm Futures executive editor Mike Wilson took a deep-dive look at some potentially successful strategies – click here to learn more.
China plans to diversify its corn suppliers by increasing its purchases from Brazil in a move to reduce its dependence on the United States, and as it seeks more secure supplies rather than lean heavily on the volatile Black Sea region. “A rally of more than 20% in Chicago corn futures in less than three months, compounded by a surging US dollar, has increased the urgency of finding alternative cargoes,” according to reporting by Bloomberg. Click here to learn more.
Preliminary volume estimates were for 276,365 contracts, moving around 9% below Wednesday’s final count of 304,846.
Soybeans
Soybean prices managed to erase most of the losses incurred overnight, which were around 5 to 7 cents. Still, prices remained in the red after some net technical selling today. November futures eased 2 cents to $13.94, with January futures down 0.75 cents to $14.0425.
Soybean basis bids were mixed after rising 5 to 15 cents higher at four Midwestern facilities while softening 3 to 10 cents lower at two other locations on Thursday.
Private exporters announced two more large soybean sales this morning. The first was for 9.7 million bushels to China, and the second was for 8.9 million bushels to unknown destinations. Both sales were for delivery during the 2022/23 marketing year, which began September 1.
Prior to tomorrow morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 22.0 million and 51.4 million bushels for the week ending October 6. Analyst also expect to see soymeal sales ranging between 50,000 and 300,000 metric tons, plus up to 20,000 MT of soyoil sales.
Preliminary volume estimates were for 275,146 contracts, shifting 29% below Wednesday’s final count of 387,997.
Wheat
Wheat prices moved 1% to 1.25% higher on concerns that a Black Sea shipping deal may be in jeopardy. A weakening U.S. Dollar lent additional support. December Chicago SRW futures added 8.75 cents to $8.91, December Kansas City HRW futures rose 12.25 cents to $9.8225, and December MGEX spring wheat futures gained 9.25 cents to $9.76.
Ahead of Friday morning’s export report from USDA, analysts are expecting to see wheat sales ranging between 7.3 million and 18.4 million bushels for the week ending October 6.
Russia is threatening to refuse renewal of a current Black Sea shipping deal that is allowing grain and other exports to leave Ukrainian ports unless its demands are met. The agreement was brokered by the United Nations and Turkey in July and is up for renewal in November. Russia is asking for improved facilitation of its own grain and fertilizer.
In Argentina, the Buenos Aires grains exchange lowered its forecast for the country’s 2022/23 wheat production by 5.7% to 606.3 million bushels. La Ni?a conditions are generating plenty of overly dry weather in some key production regions of Argentina, which in turn hurt crop yield prospects. If realized, this would be the lowest Argentine wheat output in seven years.
The Philippines issued a tender to purchase 6.1 million bushels of animal feed wheat from optional origins that closes today. The grain is comprised of three consignments that will be shipped in January, February and March.
As expected, Japan purchased 3.5 million bushels of food-quality wheat from the United States, Canada and Australia in a regular tender that closed earlier today. Of the total, 27% was sourced from the U.S. The grain is for arrival by the end of January.
Preliminary volume estimates were for 86,262 CBOT contracts, which was slightly higher than Wednesday’s final count of 77,726.
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