Afternoon report: Wheat prices mixed but mostly higher in Tuesday’s session
Grain prices were mixed but mostly higher on Tuesday as traders resumed a holiday-shortened week today. Corn prices showed the most upside, with prices rising more than 1.5% higher on lingering concerns about U.S. crop quality and production potential. Wheat prices also made moderate inroads today. Soybeans failed to follow suit, however, with Argentina offering an improved exchange rate to farmers – a move that is likely to boost short-term sales. The news had U.S. prices trending more than 1.25% lower.
Some parts of the Northern Plains and upper Midwest will see some rainfall between Wednesday and Saturday, but large portions of the Corn Belt won’t see any measurable moisture during that time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s new 8-to-14-day outlook predicts near-normal to slightly dry precipitation totals in the Midwest between September 13 and September 19, with most of the United States likely to see above-normal temperatures
On Wall St., the Dow sank 160 points lower in afternoon trading to 31,158 on persistent concerns that interest rates will keep moving aggressively higher in the near term. Energy futures were mixed. Crude oil tested 0.3% gains this afternoon, staying just above $87 per barrel. Diesel ticked 0.25% higher, while gasoline faded 1.25% lower. The U.S. Dollar firmed moderately.
On Friday, commodity funds were net buyers of all major grain contracts, including corn (+5,000), soybeans (+10,000), soymeal (+3,000), soyoil (+7,500) and CBOT wheat (+6,000).
Corn
Corn prices found double-digit gains as analysts expect to see another round of lower crop quality from USDA later this afternoon, which triggered a round of technical buying. September futures rose 13 cents to $6.82, with December futures up 10.25 cents to $6.76.
Corn basis bids were steady to mixed on Tuesday after moving as much as 10 cents lower at an Illinois processor and as much as 25 cents higher at an Illinois ethanol plant today.
Corn export inspections for the week ending September 1 declined moderately to 20.4 million bushels. That was on the low end of trade estimates, which ranged between 19.7 million and 32.5 million bushels. The 2022/23 marketing year began on September 1. Mexico, China, Japan, Ireland and Costa Rica were the top five destinations.
Prior to this afternoon’s crop progress report from USDA, analysts think the agency will show corn ratings decline another point for the week ending September 4, with 53% in good-to-excellent condition. Individual trade guesses ranged between 52% and 53%.
The latest data from the European Commission shows that EU 2022/23 corn imports are trending well above last year’s pace so far, with 176.0 million bushels through September 3.
Brazilian consultancy AgRural reported that 9% of the country’s first corn crop has been planted so far, which is slightly behind last season’s pace of 10.1%. AgRural predicts that 2022/23 first corn production will reach 1.110 billion bushels, which would be a year-over-year increase of 13.7%, if realized.
South Korea issued an international tender to purchase 5.5 million bushels from optional origins that closes today. The grain is comprised of two consignments for arrival in December and January.
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Preliminary volume estimates were for 148,338 contracts, moving ahead of Friday’s final count of 132,419.
Soybeans
Soybean prices sank on the prospect of more Argentine exports after the country offered a preferential exchange rate for soybean exports for the rest of September. That move also left soymeal and soyoil prices in the red today. September soybean futures fell 20.5 cents to $14.90, with November futures down 19.75 cents to $14.0075.
Soybean basis bids were mostly steady on Tuesday but did slide 10 cents lower at an Illinois river terminal while climbing 20 to 35 cents higher at two other Midwestern locations today.
Soybean export inspections moved moderately higher for the week ending September 1, with 18.2 million bushels. That was still toward the lower end of trade estimates, however, which ranged between 14.7 million and 29.4 million bushels. China, Mexico, Algeria, Japan and Costa Rica were the top five destinations.
Ahead of the next USDA crop progress report, analysts expect to see another one-point decline for soybean quality ratings, with 56% of the crop in good-to-excellent condition through Sunday. Individual trade guesses ranged between 55% and 57%.
European Union soybean imports for the 2022/23 marketing year are off to a moderately slow start compared to last year’s pace, with 79.4 million bushels through September 3. EU soymeal imports are also trending below year-ago totals, with 2.73 million metric tons.
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Preliminary volume estimates were for 115,424 contracts, shifting 28% above Friday’s final count of 90,515.
Wheat
Wheat prices moved as much as 1% higher after a round of technical buying on Tuesday on the heels of solid domestic demand and a flurry of recent overseas sales. December Chicago SRW futures added 9.25 cents to $8.2025, December Kansas City HRW futures picked up 5.75 cents to $8.2025, and December MGEX spring wheat futures held steady at $8.90.
Wheat export inspections faded moderately lower, reaching 17.6 million bushels for the week ending September 1. That was close to the middle of analyst estimates, which ranged between 14.7 million and 23.0 million bushels. Cumulative totals for the 2022/23 marketing year are trending moderately below last year’s pace so far, with 205.9 million bushels. Last week, Mexico, South Korea, Japan, the Philippines and Ecuador were the top five destinations.
Ahead of this afternoon’s crop progress report from USDA, analysts think the agency will show spring wheat harvest move from 50% complete a week ago up to 67% through September 4. Analysts also expect to see USDA’s first winter wheat planting data, with an estimated 4% of the 2022/23 crop in the ground so far.
European Union’s 2022/23 soft wheat exports reached 228.2 million bushels through September 3, which is slightly above last year’s pace so far. EU barley exports are sharply lower year-over-year, with 74.4 million bushels.
Russia’s Sovecon consultancy estimates that the country exported 128.6 million bushels of wheat in August. If realized, that was the highest monthly tally since last September but still 52% lower year-over-year. Russia is the world’s No. 1 wheat exporter.
Iraq purchased 3.7 million bushels of hard red wheat that was sourced from the United States in a direct purchase agreement with Anderson. Additional details of the sale were not immediately available.
Jordan purchased 2.2 million bushels of wheat from optional origins in an international tender, which is for shipment in late February. Jordan also issued a new tender to purchase an additional 4.4 million bushels of wheat that closes on September 13.
Taiwan issued an international tender to purchase 2.0 million bushels of grade 1 milling wheat from the United States, which closes on Thursday. The grain is for shipment in November.
Preliminary volume estimates were for 45,094 CBOT contracts, moving slightly below Friday’s final count of 49,089.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Sep
682
667.5
680.75
13
22-Dec
676.5
661.5
676
10.25
Soybeans
22-Sep
1493
1487.5
1490
-20.5
22-Nov
1423
1392.25
1398.75
-19.75
Soymeal $/ton
22-Oct
419
408.7
410.6
-12.7
Soyoil cents/lb
22-Oct
67.93
64.8
64.9
-3.07
Wheat $/bushel
22-Sep
800.75
794.25
800
7
22-Dec
825
801.25
817
9.25
KC Wheat
22-Sep
750
879
22-Dec
894
871.5
882
5.75
MPLS Wheat
22-Sep
881
865
871
7.25
22-Dec
907
882.5
889.75
0
Live Cattle cents/lb
22-Oct
145.4
144.55
145.075
0.525
Feeder Cattle cents/lb
22-Oct
187
184.875
185.925
0.975
Lean Hogs cents/lb
22-Dec
83.65
82.25
83.475
0.775
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Oct
90.39
86.18
86.9
0.03
Diesel
22-Oct
3.7771
3.5375
3.5846
0.0066
Unleaded Gasoline $/gallon
22-Oct
2.5299
2.4083
2.4202
-0.0434
Natural Gas
22-Nov
9.176
8.147
8.252
-0.598
U.S. Dollar Index
22-Sep
110.55
109.37
110.23
0.72
Gold $/ounce
22-Oct
1727
1701.3
1701.1
-8.7
Copper
22-Sep
3.47
3.3825
3.4515
0.03
Fertilizer Swaps
(as of 09/02)
DAP Tampa-index
820.0
0
DAP-New Orleans
833.9
18.19
Urea-New Orleans
766.1
82.67
Urea-Middle East
863.0
68.5
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
531.9
55.12
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