Afternoon report: Corn and soybeans shift lower, while wheat stays firm
Grain prices were moderately mixed after an uneven round of technical maneuvering on Wednesday. Corn prices fell 0.9% and soybeans lost 1.2% after some technical selling partly spurred by harvest pressure coupled with a strengthening U.S. Dollar. Wheat fared better amid concerns that Russia plans to escalate its war efforts in Ukraine. Most contracts were up around 0.5% to 0.75% today.
Wet weather is most likely to occur in the Central Plains and western Corn Belt between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts seasonally hot and dry conditions for most of the central U.S. between September 29 and October 5.
On Wall St., the Dow slid 52 points lower in afternoon trading to 30,653. The Federal Reserve announced it would raise interest rates by another 75 basis points – a move that was largely expected. Energy futures were mixed. Crude oil was down slightly, staying just below $84 per barrel. Diesel dropped 0.75%, while gasoline firmed 2% higher. The U.S. Dollar firmed moderately.
On Tuesday, commodity funds were net buyers of all major grain contracts, including corn (+10,000), soybeans (+6,000), soymeal (+7,000), soyoil (+1,000) and CBOT wheat (+20,000).
Corn
Corn prices spilled 0.9% lower on a round of technical selling on Wednesday. Harvest is providing some seasonal downward pressure, with South American farmers getting ready for their 2022/23 season already. December and March futures each dropped 6.25 cents to close at $6.8575 and $6.9050, respectively.
Corn basis bids were steady to mixed across a handful of locations on Wednesday after moving as much as 10 cents higher at two Midwestern processors while tumbling as much as 99 cents lower at an Illinois river terminal today.
Ethanol production tumbled to a daily average of 901,000 barrels in the week ending September 16, per the latest data from the U.S. Energy Information Administration, out earlier today. It was also the lowest weekly total since February 2021. Ethanol stocks declined by 1%.
Ahead of the next USDA export report, out tomorrow morning and covering the week through September 15, analysts expect the agency to show corn sales ranging between 15.7 million and 33.5 million bushels.
Representatives from Iowa and Taiwan recently signed a letter intent to purchase around $600 million worth of corn products in 2023 and 2024, which would include 59.1 million bushels of corn and 9.8 million bushels of DDGS. “Letters of intent allow us to share our bounty with great corn customers, like Taiwan, and mean a great deal for Iowa corn farmers in terms of market opportunity and development,” according to Iowa Corn Promotion Board president Larry Buss.
Ukraine’s agriculture ministry reports that the county’s total 2022/23 grain exports are down more than 43% year-over-year so far. That includes corn exports totaling 155.5 million bushels, plus 84.5 million bushels of wheat and 27.5 million bushels of barley. Sales are obviously down due to land losses from the Russian invasion and lower per-acre yields.
Join us next week at the online platform Farm Progress 365 for free informational sessions devoted to maximizing yield maps and putting them to work on your operation. The sessions will take place September 27, 28 and 29 – click here to learn more about them and sign up today!
Preliminary volume estimates were for 200,584 contracts, which was slightly above Tuesday’s final count of 183,057.
Soybeans
Soybean prices followed corn lower today on a round of technical selling that trimmed prices by double-digits, closing with losses of 1.2%. November and January futures each fell 17.75 cents lower to close at $14.61 and $14.6675, respectively.
Soybean basis bids were mostly steady across the central U.S. on Wednesday but did tilt 10 cents lower at an Iowa processor while picking up a penny at an Ohio elevator today.
Prior to tomorrow morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 18.4 million and 36.7 million bushels for the week ending September 15. Analysts also anticipate soymeal sales ranging between 75,000 and 350,000 metric tons, plus up to 32,000 MT of soyoil sales.
Argentine farmers have been robust sellers of their soybeans in recent weeks. Between September 8 and 14 alone, sales totaled 84.5 million bushels after governmental moves to initiate a more preferable exchange rate. Argentina is one of the world’s top exporters of soybeans, soymeal and soyoil.
What factors will prove to be the biggest market-movers over the next few months? Brady Huck, risk advisor with Advance Trading, has his eye on four unfolding factors in particular – South American production, Russia/Ukraine, U.S/China relations and global economic trends. Huck offers more in-depth analysis on each of these four areas in yesterday’s Ag Marketing IQ blog – click here to learn more.
How are your crops looking this week? Have you started harvest yet? 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 peer anecdotes from around the country.
Preliminary volume estimates were for 160,495 contracts, sliding slightly below Tuesday’s final count of 168,811.
Wheat
Wheat prices trended moderately higher amid ongoing Black Sea production and export challenges, not to mention that Russian president Vladimir Putin announced a partial military mobilization for Russian citizens. December Chicago SRW futures added 7.25 cents to $9.01, December Kansas City HRW futures picked up 4 cents to $9.67, and December MGEX spring wheat futures gained 8 cents to $9.6725.
Ahead of Thursday morning’s export report from USDA, analysts think the agency will show wheat sales ranging between 7.3 million and 18.4 million bushels for the week ending September 15.
Egypt’s cabinet issued a statement today noting the country’s strategic wheat reserves are sufficient for more than six months. Egypt also has adequate vegetable oil supplies for more than five months. It ranks among the world’s top importers of both commodities.
Zimbabwe could reap a record wheat harvest this season, with production exceeding 18 million bushels. The country hopes to lessen its reliance on foreign imports, and wheat and white corn comprise its top two staple foods.
The Philippines issued an international tender to purchase 1.7 million bushels of animal feed wheat from optional origins (including the United States) that closes on Thursday. The grain is for shipment between December and February.
Preliminary volume estimates were for 147,655 CBOT contracts, moving moderately ahead of Tuesday’s final count of 107,689.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Dec
698.5
679.25
685.5
-6.25
23-Mar
702.75
684.25
690.25
-6.25
Soybeans
22-Nov
1488.75
1459.5
1461.25
-17.75
23-Jan
1493.5
1465.25
1467
-17.75
Soymeal $/ton
22-Dec
442.3
430.9
438.8
-1.3
Soyoil cents/lb
22-Dec
66.82
64.7
65
-0.93
Wheat $/bushel
22-Dec
919.5
873
903.75
7.25
23-Mar
932
887
915.25
6.5
KC Wheat
22-Dec
982
944.25
967
4
23-Mar
977
941.25
963.5
4
MPLS Wheat
22-Dec
975
941.5
964.25
8
23-Mar
975.5
945.75
968.5
7.75
Live Cattle cents/lb
22-Oct
146.475
145.75
145.9
-0.4
Feeder Cattle cents/lb
22-Oct
181.35
178.675
179.1
-0.925
Lean Hogs cents/lb
22-Dec
88.3
86.275
86.55
-1.625
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Oct
86.68
82.49
83.71
-0.23
Diesel
22-Oct
3.499
3.263
3.35
-0.0222
Unleaded Gasoline $/gallon
22-Oct
2.5224
2.4335
2.5008
0.053
Natural Gas
22-Nov
8.179
7.609
7.85
0.078
U.S. Dollar Index
22-Sep
111.36
109.86
110.72
0.778
Gold $/ounce
22-Oct
1687
1651.5
1680.1
20.4
Copper
22-Sep
3.553
3.45
3.454
-0.094
Fertilizer Swaps
(as of 09/16)
DAP Tampa-index
765.0
-52.5
DAP-New Orleans
837.8
-5.51
Urea-New Orleans
734.1
25.9
Urea-Middle East
865.0
-20
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
556.7
16.53
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