Afternoon report: Soybeans and wheat spill into the red on Thursday.
Corn prices tried to inch a bit closer to life-of-contract highs on Thursday as bullish sentiment remained in play but ultimately finished the session with slightly mixed results. Rainy weather across the Corn Belt is expected to hand out additional planting delays this spring, while the war in Ukraine continues to limit grain availability overseas. But weather-related delays could boost soybean acres this season, and prices responded by shifting moderately lower. Wheat prices also slumped after a disappointing set of export data prompted some technical selling and profit-taking today.
Ample wet weather is likely for large swaths of the Midwest and Plains between Friday and Monday, per the latest 72-hour cumulative precipitation map from NOAA. Significant portions of Nebraska and the Dakotas could see 2″ to 3″ fall during this time. NOAA’s latest 8-to-14-day forecast predicts near-normal precipitation for much of the Corn Belt between May 5 and May 11, with seasonally cool weather returning to the Great Lakes region and Ohio River Valley.
On Wall St., the Dow climbed 604 points in afternoon trading to 33,907 after more strong Q1 corporate earnings reports boosted investor sentiment. Energy futures also firmed, with crude oil up 2.5% this afternoon to $104 per barrel on the increasing likelihood that the European Union could embargo Russian supplies. Diesel and gasoline were each trending around 1.75% higher. The U.S. Dollar firmed moderately, reaching the strongest levels in more than two years.
On Wednesday, commodity funds were net buyers of corn (+8,500), soybeans (+10,500), soymeal (+3,500) and soyoil (+9,000) contracts but were net sellers of CBOT wheat (-1,500).
NOTE: Once again this season, Farm Futures will be collecting and regularly sharing farmer anecdotes in our Feedback from the Field series. The first round is already out – click here to see what’s happening around farm country and learn how you can participate.
Corn
Corn prices finished Thursday’s session with narrowly mixed results, failing its bid to move higher again today. Even so, the overall environment remains very bullish amid probable planting delays in the U.S. and rampant export challenges in Ukraine. May futures slipped half a penny lower to $8.15, while July futures picked up 0.75 cents to $8.13.
Corn basis bids were mostly steady across the central U.S. on Thursday but did tilt 6 cents higher at an Ohio elevator and 5 cents higher at an Iowa processor today.
Private exporters announced the sale of 42.8 million bushels of corn to China. Of the total, 44% is for delivery during the current marketing year, with the remainder for delivery in 2022/23.
Corn exports saw 34.9 million bushels in old crop sales plus 33.2 million bushels in new crop sales for a total of 68.1 million bushels. Old crop sales trended 5% below the prior four-week average. Analysts were generally expecting a larger haul, with estimates ranging between 62.5 million and 104.7 million bushels. Cumulative totals for the 2021/22 marketing year are still moderately below last year’s pace, with 1.501 billion bushels.
Corn export shipments were up 31% from a week ago and steady with the prior four-week average, with 61.5 million bushels. Japan was the No. 1 destination, with 15.2 million bushels.
The upcoming May supply and demand report from USDA is likely “the most bearish report we will see this year barring a Black Swan event on the demand side,” according to Bill Biedermann, hedging strategist with AgMarket.Net. Biedermann explains why he takes this position and offers additional analysis in the latest Ag Marketing IQ blog – click here to learn more.
Preliminary volume estimates were for 285,652 contracts, taking a moderate step down from Wednesday’s final count of 332,609.
Soybeans
Soybean prices eroded moderately lower as traders increasingly expect to see an uptick in soybean acres this season. (Something that Farm Futures has been predicting since January, it should be noted.) A lackluster set of export data from USDA this morning generated additional headwinds. May futures dropped 15.75 cents to $17.1075, with July futures down 8.25 cents to $16.8450.
Soybean basis bids were mostly steady across the central U.S. but did shift 6 cents lower at an Ohio elevator while jumping 44 cents higher at an Illinois river terminal today.
Soybean exports found 17.7 million bushels in old crop sales plus another 21.3 million bushels in new crop sales for a total of 39.0 million bushels. That was toward the middle of trade estimates, which ranged between 18.4 million and 57.0 million bushels. Cumulative totals for the 2021/22 marketing year are still running more than 300 million bushels behind last year’s pace, with 1.717 billion bushels.
Soybean export shipments slid 10% below the prior four-week average to 26.1 million bushels. China was the No. 1 destination, with 10.3 million bushels.
Indonesia’s palm oil export ban has stalled around 290,000 metric tons that was initially bound for India. “We don’t know when Indonesia will lift the ban and stuck shipments will be delivered,” according to one Indian buyer. India is the world’s No. 1 palm oil importer, with monthly purchases of around 700,000 MT. Indonesia typically supplies around half of that total.
In Egypt, the country’s vegetable oil reserves are sufficient for the next six months, according to the country’s supply ministry. Egypt even cancelled an international tender to buy additional vegetable oils earlier today.
Preliminary volume estimates were for 128,839 contracts, tracking 37% below Wednesday’s final count of 204,412.
Wheat
Wheat prices tilted moderately lower after a bearish set of export data from USDA spurred some technical selling and profit-taking today. May Chicago SRW futures fell 8 cents to $10.72, May Kansas City HRW futures dropped 12.5 cents to $11.3575, and May MGEX spring wheat futures lost 12.5 cents to $11.8625.
Wheat exports only found 1.2 million bushels in old crop sales, with another 4.6 million bushels in new crop sales bringing last week’s total to 5.8 million bushels. Analysts generally expected a bigger haul, with trade guesses ranging between 5.5 million and 21.1 million bushels. Cumulative totals for the 2021/22 marketing year are still moderately behind last year’s pace, with 620.8 million bushels.
Wheat export shipments slumped 35% below the prior four-week average, with 9.0 million bushels. Italy topped all destinations, with 2.0 million bushels.
Ukraine’s Foreign Ministry is accusing Russia of stealing grain in areas it has occupied. “The looting of grain from the Kherson region, as well as the blocking of shipments from Ukrainian ports and the mining of shipping lanes, threaten the world’s food security,” according to a written statement on the matter.
As expected, Jordan issued a new international tender to purchase 4.4 million bushels of milling wheat from optional origins after passing on all offers in a similar tender that closed yesterday. Offers for the new tender must be submitted by May 11, and the grain is for shipment in June and/or August.
Preliminary volume estimates were for 55,366 CBOT contracts, firming slightly above Wednesday’s final count of 46,854.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-May
823.5
811
816
-0.5
22-Jul
819.75
808.5
813.5
0.75
Soybeans
22-May
1734
1703.75
1706.5
-15.75
22-Jul
1700
1681.25
1684.75
-8.25
Soymeal $/ton
22-Jul
442
429.3
430.1
-10.6
Soyoil cents/lb
22-Jul
86.69
83.68
86.6
1.83
Wheat $/bushel
22-May
1094
1070
1074
-8
22-Jul
1106.5
1081
1085.75
-7
KC Wheat
22-May
1156.25
1135
1136.25
-12.5
22-Jul
1162.75
1140
1141.25
-14
MPLS Wheat
22-May
1209
1186.25
1190.5
-12.5
22-Jul
1206
1188.75
1191.5
-3.75
Live Cattle cents/lb
22-Apr
139.575
137.775
137.775
-0.725
Feeder Cattle cents/lb
22-May
158.85
157.225
158.05
0.7
Lean Hogs cents/lb
22-Jun
111.7
108.725
111.025
0.675
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Jun
105.68
100.13
105.54
3.52
Diesel
22-May
5.2215
4.6635
5.0437
0.3694
Unleaded Gasoline $/gallon
22-May
3.5344
3.4152
3.4967
0.0407
Natural Gas
22-Jul
7.517
6.985
7.07
-0.366
U.S. Dollar Index
22-Jun
103.95
103.01
103.645
0.682
Gold $/ounce
22-Jun
1896.2
1870.9
1889
3.2
Copper
22-May
4.4695
4.3665
4.421
-0.0355
Fertilizer Swaps
(as of 04/15)
DAP Tampa-index
1,240.0
0
DAP-New Orleans
1,052.7
0
Urea-New Orleans
854.3
-33.07
Urea-Middle East
995.0
-125
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
694.5
-5.51
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