Afternoon report: Wheat prices also firm on Thursday, with corn down slightly
Grain prices were mixed but mostly higher on Thursday, anchored by solid gains of more than 2% for soybeans after a flash sale to Pakistan announced this morning spurred a round of technical buying. Wheat prices also made moderate inroads today, with winter wheat contracts up more than 1.75% and spring wheat contracts firming 0.5%. Corn bucked the overall trend, closing today’s session with modest losses.
Some additional rains are expected to land on parts of the Midwest and Plains between Friday and Monday, but very few areas will receive more than 0.5″ during this time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts seasonally wet conditions for most areas east of the Mississippi River between June 9 and July 15, with cooler-than-normal temperatures for most of the Corn Belt.
On Wall St., the Dow climbed 260 points higher in afternoon trading to 33,073 as investors cling to hope that inflation trends will soon cool off. Energy futures were on the rise, with crude oil firming another 1.25% this afternoon to $116 per barrel, despite reports that OPEC will boost production faster than some analysts had expected. Diesel found gains of around 1.5%, while gasoline jumped 2.75% higher. The U.S. Dollar softened moderately.
On Wednesday, commodity funds were net buyers of soybeans (+4,000) and soyoil (+2,000) contracts but were net sellers of corn (-22,000), soymeal (-2,000) and CBOT wheat (-16,000).
Corn
Corn prices were unable to hold onto modest overnight gains after a choppy session on Thursday sent them slightly into the red on some net technical selling. July futures dropped 2.5 cents to $7.2875, while September futures eased half a penny lower to $7.0325.
Corn basis bids were steady to mixed across the central U.S. on Thursday after rising as much as 10 cents higher at an Illinois ethanol plant and falling as much as 5 cents lower at a Nebraska processor today.
Ethanol production made solid inroads in the week ending May 27, climbing to a daily average of 1.071 million barrels, per the latest data from the U.S. Energy Information Administration out earlier today. That’s the best weekly effort since last November. Ethanol stocks moved 3% lower from the prior week.
Ahead of tomorrow morning’s export report from USDA, analysts think the agency will show corn sales ranging between 8.9 million and 27.6 million bushels for the week ending May 26.
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Preliminary volume estimates were for 250,170 contracts, falling significantly short of Wednesday’s final count of 454,594.
Soybeans
Soybean prices captured gains of more than 2% on overall export optimism after Pakistan confirmed a major purchase this morning. Soyoil futures jumped 4% higher, meantime, with soymeal prices up around 0.75%. July soybean futures rose 39.75 cents to $17.30, with August futures up 34 cents to $16.59.
Soybean basis bids were steady to mixed on Thursday after rising 10 cents higher at two Midwestern processors while falling as much as 7 cents lower at an Illinois river terminal today.
Private exporters reported to USDA the sale of 12.9 million bushels of soybeans to Pakistan. Of the total, 16% is for delivery during the current marketing year, which began September 1. The remainder is for delivery in 2022/23.
Ahead of Friday morning’s export report from USDA, analysts expect the agency to show soybean sales ranging between 7.3 million and 39.4 million bushels for the week ending May 26. Analysts also think USDA will show soymeal sales ranging between 100,000 and 320,000 metric tons, plus up to 40,000 MT of soyoil sales.
China plans to auction off another 18.4 million bushels of its imported soybean reserves on June 10, according to the country’s National Grain Trade Center. The sale is meant to boost local supplies, and similar sales have routinely been conducted throughout 2022.
A Farm Bill funding fight is already brewing, according to Farm Futures policy editor Jacqui Fatka. “All the funds allocated under the pandemic assistance are not part of the 2018 Farm Bill baseline, so any increases in spending would need to be offset with decreases elsewhere,” she writes. “Rising input costs continue to pose a problem that policymakers and industry groups don’t know yet how to manage within the farm bill safety net.” Fatka offers up more reporting on the issue in her latest DC Dialogue blog – click here to learn more.
Preliminary volume estimates were for 193,618 contracts, tracking slightly above Wednesday’s final count of 186,359.
Wheat
Wheat prices spilled to two-month lows earlier this week but rebounded moderately today on the heels of some bargain buying. Traders still anxiously await confirmation on whether Russia will allow Ukrainian ports to resume shipping grain. July Chicago SRW futures climbed 20.25 cents to $10.6150, July Kansas City HRW futures rose 20 cents to $11.4825, and July MGEX spring wheat futures added 5.25 cents to $12.0225.
Ahead of tomorrow morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 5.5 million and 16.5 million bushels for the week ending May 26.
The Ukrainian embassy in Beirut is accusing Russia of sending 3.7 million bushels of stolen wheat to Syria and described the shipment as “criminal activity” because it was sourced from Ukrainian storage facilities in areas occupied by Russia. The grain is valued at approximately $40 million. Russia did not immediately respond to the allegations.
Argentina’s Buenos Aires Grains Exchange estimates that the country’s 2022/23 wheat plantings will come in around 16.062 million acres. That’s slightly lower than the group’s prior estimate, based on low soil moisture and scant rains in the near-term forecasts.
Algeria purchased 3.3 million bushels of milling wheat from optional origins in an international tender that closed on Tuesday. At least part of the purchase is expected to be sourced from France. The grain is for shipment in July and August.
Yesterday, Egypt announced it had purchased 17.1 million bushels of wheat in an international tender. The grain was sourced from Russia, Romania and Bulgaria.
Preliminary volume estimates were for 90,093 CBOT contracts, spilling moderately below Wednesday’s final count of 147,096.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Jul
739.25
726.25
730.25
-2.5
22-Sep
711.25
700.5
704.75
-0.5
Soybeans
22-Jul
1740.75
1681.25
1729.25
39.75
22-Sep
1586.75
1542
1580.5
29.5
Soymeal $/ton
22-Aug
412.2
405.9
408.4
1.7
Soyoil cents/lb
22-Aug
79.75
76.24
79.56
2.78
Wheat $/bushel
22-Jul
1075
1037.25
1058.25
20.25
22-Sep
1085
1048.5
1069.75
20.5
KC Wheat
22-Jul
1163
1127.75
1143.5
20
22-Sep
1168.75
1134.5
1150.25
19.25
MPLS Wheat
22-Jul
1219.75
1197
1199.5
5.25
22-Sep
1219.5
1198
1201.5
8.25
Live Cattle cents/lb
22-Jun
133.75
132.225
133.6
0.8
Feeder Cattle cents/lb
22-Sep
175.925
172.075
175.6
3.2
Lean Hogs cents/lb
22-Jul
114
111.825
111.95
-0.475
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Jun
117.56
111.2
116.77
1.51
Diesel
22-Jun
4.2606
4.0271
4.2586
0.1153
Unleaded Gasoline $/gallon
22-Jun
4.215
3.99
4.1954
0.1238
Natural Gas
22-Aug
9.04
8.37
8.501
-0.185
U.S. Dollar Index
22-Jun
102.645
101.745
101.795
-0.734
Gold $/ounce
22-Jul
1870.5
1844
1867.1
23.8
Copper
22-Jun
4.5495
4.389
4.5465
0.2165
Fertilizer Swaps
(as of 05/27)
DAP Tampa-index
1,117.5
0
DAP-New Orleans
917.7
-2.76
Urea-New Orleans
642.1
-49.6
Urea-Middle East
720.0
11.5
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
683.4
-5.51
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