Afternoon report: Corn, soybeans and wheat all make significant inroads on Thursday.
Volatility remains the name of the game for grain prices as traders continue to assess the Russian invasion of Ukraine. Corn prices fared the best today, jumping more than 3% higher on a wave of technical buying. Most wheat contracts rose around 2% to 2.5% higher, while soybeans firmed around 1.25%.
The first day of spring is this coming Sunday, and some springlike weather is already showing up around some parts of the Midwest and Plains, with areas as far north as Detroit reaching 70 degrees today. Looking further ahead, NOAA’s 8-to-14-day outlook predicts some seasonally cool weather returning to parts of the central U.S. between March 24 and March 30, with seasonally dry weather stretching from the West Coast all the way into the Ohio River Valley.
On Wall St., the Dow was on pace for a third consecutive day of gains, trending 252 points higher in afternoon trading to 34,315 as investors continue to digest headlines from the Black Sea region and mull the Federal Reserve’s latest interest rate hike. Energy futures saw a major rebound, with crude oil up more than 8% this afternoon to move back above $102 per barrel. Diesel jumped nearly 12% higher, with gasoline rising 7.5%. The U.S. Dollar softened moderately.
On Wednesday, commodity funds were net sellers of all major grain contracts, including corn (-20,000), soybeans (-6,000), soymeal (-5,000), soyoil (-1,000) and CBOT wheat (-15,000).
Corn
Corn prices gained more than 3% Thursday as worries over global supplies and optimism over U.S. export demand triggered a round of technical buying today. May futures rose 23.25 cents to $7.5325, with July futures up 21 cents to $7.18.
Corn basis bids were steady to weak after falling 1 to 7 cents lower across four Midwestern locations on Thursday.
Private exporters announced to USDA the sale of 5.4 million bushels of corn for delivery to unknown destinations during the current marketing year, which began September 1.
Corn exports found 73.3 million bushels in old crop sales plus another 8.0 million bushels in new crop sales for a total tally of 81.3 million bushels. That was well above the entire range of trade guesses, which came in between 27.6 million and 63.0 million bushels. Cumulative totals for the 2021/22 marketing year are trending slightly below last year’s pace, with 1.134 billion bushels.
Corn export shipments shifted 28% lower week-over-week and fell 25% below the prior four-week average, to 50.1 million bushels. China was the No. 1 destination, with 13.2 million bushels.
The International Grains Council slashed its estimates for Ukraine’s 2021/22 grain exports by 24%. That includes corn exports now projected at 826.7 million bushels (down 34%) and wheat exports at 764.3 million bushels (down 15%). Ukraine is among the world’s top exporters of both commodities.
Worldwide, the International Grains Council raised its forecast for global 2021/22 corn production by 4 million metric tons (just over 157 million bushels) to reach 1.207 billion metric tons.
South Korea purchased 2.6 million bushels of animal feed corn from optional origins in an international tender that closed earlier today. The grain is for arrival on or around June 15.
Preliminary volume estimates were for 168,525 contracts, tracking moderately below Wednesday’s final count of 219176.
Soybeans
Soybean prices firmed 1.25% higher on Thursday despite a less-than-stellar round of export sales data from USDA this morning. Spillover strength from other commodities lent ample support, however, and lingering questions about the size of this season’s South American crops are still relevant. May futures rose 19.5 cents to $16.6875, with July futures up 21.5 cents to $16.4750.
Soybean basis bids were steady to mixed on Thursday after falling 2 to 10 cents lower at two river terminals and firming a penny at an Ohio elevator today.
Old crop soybean sales fell 43% below the prior week’s tally, with 46.0 million bushels. New crop sales added 17.5 million bushels, for a total of 63.5 million bushels. That was toward the lower end of analyst estimates, which ranged between 51.4 million and 110.2 million bushels. Cumulative totals for the 2021/22 marketing year are still trailing last year’s pace by more than 400 million bushels after reaching 1.555 billion bushels.
Soybean export shipments fell 29% below the prior four-week average to 26.2 million bushels. China was again the No. 1 destination, with 13.6 million bushels.
Brazil’s Agroconsult predicts the country’s 2022 soybean exports will total 2.866 billion bushels. Agroconsult also estimates that Brazilian corn exports will total 1.638 billion bushels this year.
China’s state media is reporting that the country’s soybean plantings could increase by around 3.3 million acres this year. China has also auctioned off 9.4 million bushels of its imported soybean reserves and 186,000 metric tons of its imported soyoil reserves earlier this week.
Preliminary volume estimates were for 106,296 contracts, inching slightly ahead of Wednesday’s final count of 98,782.
Wheat
Wheat prices shook off modest overnight losses to rack up gains of 2% to 2.5% by the close of Thursday’s session. Spillover strength from other commodities lent support, and traders remain very focused on the ongoing turmoil in the Black Sea region. May Chicago SRW futures rose 23 cents to $10.9225, May Kansas City HRW futures added 17 cents to $10.8950, and May MGEX spring wheat futures climbed 26.5 cents to $10.7675.
Wheat exports 5.4 million bushels in old crop sales and 12.0 million bushels in new crop sales for a total of 17.4 million bushels. That was near the middle of analyst estimates, which ranged between 9.2 million and 25.7 million bushels. Cumulative totals for the 2021/22 marketing year are still moderately behind last year’s pace, with 543.1 million bushels.
Wheat export shipments dropped 42% below the prior four-week average to 9.2 million bushels. Mexico topped all destinations, with 3.0 million bushels.
The International Grains Council estimates that 2021/22 world wheat production will reach 28.697 billion bushels, which is steady from the group’s projection from a month ago.
Strategie Grains has slightly lowered its estimates for the European Union’s soft wheat production in 2022/23 by 0.9%, falling to 4.663 billion bushels. The consultancy left its estimates for 2022/23 EU corn production steady, at 2.630 billion bushels.
Germany, which is the European Union’s second-largest wheat producer, could see its 2022 wheat crop reach 830.8 million bushels, according to the country’s association of farm cooperatives. That would be a year-over-year increase of 5.8%, if realized.
Turkey made provisional purchases of 9.9 million bushels of wheat from optional origins in an international tender that closed earlier today. At least some of the grain is expected to be sourced from Russia. The wheat is sought for “rapid shipment” to arrive between March 25 and April 22.
Japan purchased 3.8 million bushels of food-quality wheat from the United States, Canada and Australia in a regular tender that closed earlier today. Of the total, 24% was sourced from the U.S. The grain is for shipment starting in late April.
South Korea issued a tender to purchase 1.7 million bushels of milling wheat sourced from the United States that closes on Friday. The grain is for shipment between May 16 and June 15.
Preliminary volume estimates were for 75,457 CBOT contracts, sliding moderately below Wednesday’s final count of 91,023.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-May
757.5
728.5
754.5
23.25
22-Jul
722
695.5
718.75
21
Soybeans
22-May
1677.5
1647.25
1668.5
19.5
22-Jul
1652.25
1624.5
1647.25
21.5
Soymeal $/ton
22-Jul
469.3
461.4
464.5
-1.3
Soyoil cents/lb
22-Jul
71.27
69.23
70.86
1.25
Wheat $/bushel
22-May
1108.25
1031.75
1098
23
22-Jul
1084.25
1013
1076
27.75
KC Wheat
22-May
1100.75
1040
1092.25
17
22-Jul
1091.75
1030
1083.25
24
MPLS Wheat
22-May
1091.25
1026.75
1079
26.5
22-Jul
1080
1015.25
1067
27.5
Live Cattle cents/lb
22-Apr
139.95
138.4
139.575
0.225
Feeder Cattle cents/lb
22-Apr
162.275
160.55
161.1
-1.525
Lean Hogs cents/lb
22-May
111.525
107.5
107.725
-3.275
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Apr
104.24
94.85
104.17
9.13
Diesel
22-Apr
3.5518
3.1312
3.4989
0.3988
Unleaded Gasoline $/gallon
22-Apr
3.2274
2.9687
3.2191
0.2316
Natural Gas
22-May
5.031
4.724
4.979
0.195
U.S. Dollar Index
22-Jun
98.48
97.715
98.015
-0.606
Gold $/ounce
22-Jun
1951
1924
1939.2
31.2
Copper
22-Mar
4.6815
4.623
4.6815
0.0935
Fertilizer Swaps
(as of 03/11)
DAP Tampa-index
895.0
27.5
DAP-New Orleans
1,047.2
68.89
Urea-New Orleans
901.1
168
Urea-Middle East
1,002.5
172
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
661.4
52.36
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