Grains fall on a round of profit-taking. (Comments are updated by 7:30 a.m. Central Time.)
Plus – Bayer reports slowed production of glyphosate, declares force majeure
Corn down 3-6 cents
Soybeans down 6-16 cents; Soymeal down $6.30/ton; Soyoil down $0.11/lb
Chicago wheat down 10-12 cents; Kansas City wheat down 10-12 cents; Minneapolis wheat up 2-3 cents
*Prices as of 6:55am CST.
Good morning! Happy Valentine’s Day! I hope your day is off to a quicker start than mine after last night’s Big Game. I’m sending all my condolences to Bengals Nation this morning. I’m still not over how great that Super Bowl halftime show was – it was a great throwback to middle school/junior high dances for me!
Here are a few of the Game’s best commercials in case you missed them – enjoy and have a good Monday!
Inputs
German seed and pesticide maker Bayer announced overnight that its key herbicide product for corn growers, glyphosate, could likely see lower production this spring after a supplier of a key ingredient was unable to meet production volumes due to “technical problems” and “mechanical failures.”
That means that farmers could see delayed or shortened shipments of the key crop input despite current contracts in place with Bayer. Farmers could also be forced to make last minute supplier changes in order to source necessary pesticide supplies in a timely fashion, with little hopes that the issue will quickly resolve. Bayer indicated that repairs at the supplier’s facility could last as long as three months.
Glyphosate is the key ingredient for Bayer’s Roundup and RangerPro pesticides. Bayer issued a letter to its customers late last week informing them of the potential delays and declaring a state of force majeure.
That means that customers will not be able to hold Bayer accountable to its contractual obligations for on time chemical delivery this spring in any potential court action that may arise from these delays. Force majeure is typically only reserved for the direst of circumstances and the current supply chain snafu that is out of the company’s control appears to qualify as such.
Global pesticides supplies are already in short order as various pandemic and supply chain related disruptions have stalled production schedules over the past year and global demand for ag chemicals continues to rise with soaring commodity prices.
“Our supplier is on track to restore production, (and) we’ve sourced additional materials and made other mitigation efforts to help best manage this situation,” Bayer said in a statement.
Corn
Corn futures fell $0.03-$0.06/bushel overnight, following losses in the soy market and second crop sowing progress in Brazil. Losses were limited by gains in the wheat complex.
Soybeans
China’s call for more domestic soybean acres overnight was not enough to help soybean markets continue last week’s rallies in the early morning trading session. Even with an increase in speculator activity in the soybean market last week, traders remained content to take the tops off last week’s highs in the soybean market overnight, sending the soybean complex falling $0.06-$0.16/bushel early this morning.
Brazilian agricultural consultancy AgRural reports overnight that 24% of Brazil’s soybean crop has been harvested as of late last week, up from 16% a week prior and 9% the same time last year.
“With rains still very frequent, the harvest in Mato Grosso has advanced at intervals, with farmers rushing to get the soybeans out of the field before major quality problems occur,” AgRural said.
The most progress has been made in Mato Grosso, though excessive rains in the Rondonia and Minas Gerais states could hinder second corn crop development. Brazil’s Center-South region remains exceptionally dry as second corn crop sowing paces continue to improve.
Wheat
Wheat prices had largely been trading higher this morning on escalating concerns about a looming Russian invasion into Ukraine, but prices in the Chicago and Kansas City markets turned negative this morning as traders sought to cash in on overnight price rallies. Only Minneapolis futures traded at a gain this morning, rising $0.02-$0.03/bushel while Chicago and Kansas City futures traded at a $0.10-$0.12/bushel loss.
The world’s top wheat importer is switching up sourcing strategies in the wake of ongoing conflict in Russia and Ukraine. “Egypt, often the world’s top wheat importer, shipped around 50% of its wheat purchases from Russia last year and around 30% from Ukraine, according to data from two regional traders”, a Reuters report stated this morning.
While it is not yet clear from where Egypt will turn for wheat supplies, especially in this era of soaring commodity prices, it is possible that the U.S. could benefit from new Egyptian wheat purchases, especially if the conflicts in the Black Sea region continue to persist.
A potentially smaller South American corn harvest means that Asian corn buyers are increasingly turning to cheaper and low-quality wheat supplies to supplement livestock rations. India and Australia are likely to step in and fill some of the wheat supply needs for Asian countries in the near future as corn prices remain elevated.
Last week’s World Agricultural Supply and Demand Estimates (WASDE) report from USDA suggested that this trend for increased wheat consumption for livestock feed will likely continue as corn prices remain high, even though human wheat usage will likely fall on the rising wheat prices.
High wheat prices will likely continue to contribute to food inflation, which led USDA to cut 2021/22 global wheat consumption for food values.
But those cows still need to eat. After lowering global livestock feed usage rates for wheat last month, USDA raised livestock feed rates for wheat nearly 42 million bushels from last month’s estimates to a record-setting 5.9 billion bushels in the February 2022 WASDE.
Weather
Temperatures will cool in the Midwest today though skies will likely remain clear, according to NOAA’s short-range forecasts. Snow is likely in Michigan today. A winter storm system developing in the Pacific Northwest could begin to push east into the Northern Plains by tomorrow morning, bringing snow and frigid temperatures.
Financials
Global equity stocks took a hit overnight as fears escalate about a potential Russian invasion into Ukraine. The S&P 500 was the lone exception this morning, trading 3.75 points (0.09%) higher to $4,413.25 while virtually all other stocks edged slightly lower on the ongoing concerns.
Also worth a read on our website, FarmFutures.com
Matthew Kruse thinks that Mato Grosso’s second corn crop will likely benefit from recent rains.
Are employees socializing on the job too much first thing in the morning? Darren Frye offers a fresh perspective on how to reframe this time into productive management.
Jacqui Fatka explains the impacts to ag from continued one-month delays to 2022 government spending plans.
2021 ag exports shattered all previous records, soaring to $177 billion.
Naomi Blohm shares three reasons why wheat prices could go even higher.
Did you miss the Farm Futures Ag Business Summit a few weeks ago in Iowa? No problem! Here are 11 great takes from the 2022 Summit!
Morning Ag Commodity Prices – 2/14/2022
Contract
Units
High
Low
Last
Net Change
% Change
MAR ’22 CORN
$ / BSH
6.5675
6.4525
6.4575
-0.0525
-0.81%
MAY ’22 CORN
$ / BSH
6.5625
6.4525
6.4575
-0.0475
-0.73%
JUL ’22 CORN
$ / BSH
6.5075
6.4
6.405
-0.0475
-0.74%
SEP ’22 CORN
$ / BSH
6.115
6.0375
6.04
-0.035
-0.58%
DEC ’22 CORN
$ / BSH
5.9875
5.9125
5.9175
-0.03
-0.50%
MAR ’23 CORN
$ / BSH
6.0525
5.99
6
-0.015
-0.25%
MAY ’23 CORN
$ / BSH
6.07
6.0125
6.0125
-0.0325
-0.54%
MAR ’22 SOYBEANS
$ / BSH
15.995
15.515
15.6875
-0.1425
-0.90%
MAY ’22 SOYBEANS
$ / BSH
16.025
15.5575
15.73
-0.1325
-0.84%
JUL ’22 SOYBEANS
$ / BSH
15.9725
15.5175
15.69
-0.12
-0.76%
AUG ’22 SOYBEANS
$ / BSH
15.6275
15.2225
15.365
-0.12
-0.77%
SEP ’22 SOYBEANS
$ / BSH
14.9125
14.58
14.7325
-0.085
-0.57%
NOV ’22 SOYBEANS
$ / BSH
14.5575
14.23
14.3825
-0.0575
-0.40%
JAN ’23 SOYBEANS
$ / BSH
14.5075
14.2075
14.3375
-0.0625
-0.43%
MAR ’23 SOYBEANS
$ / BSH
14.195
13.91
14.0375
-0.07
-0.50%
MAY ’23 SOYBEANS
$ / BSH
14.05
13.8
13.91
-0.06
-0.43%
MAR ’22 SOYBEAN OIL
$ / LB
66.66
65.07
65.8
0.08
0.12%
MAY ’22 SOYBEAN OIL
$ / LB
66.6
65.08
65.81
0.15
0.23%
MAR ’22 SOY MEAL
$ / TON
460.2
446.1
449.7
-6.9
-1.51%
MAY ’22 SOY MEAL
$ / TON
457.4
443.5
447.4
-6.6
-1.45%
JUL ’22 SOY MEAL
$ / TON
455.8
442.7
446.5
-6.1
-1.35%
AUG ’22 SOY MEAL
$ / TON
445
434.1
438.1
-4.8
-1.08%
SEP ’22 SOY MEAL
$ / TON
431.1
422.3
422.5
-6.7
-1.56%
MAR ’22 Chicago SRW
$ / BSH
8.135
7.855
7.865
-0.1125
-1.41%
MAY ’22 Chicago SRW
$ / BSH
8.2
7.925
7.93
-0.11
-1.37%
JUL ’22 Chicago SRW
$ / BSH
8.1375
7.9
7.9025
-0.0825
-1.03%
SEP ’22 Chicago SRW
$ / BSH
8.1275
7.9125
7.9125
-0.07
-0.88%
DEC ’22 Chicago SRW
$ / BSH
8.155
7.94
7.9475
-0.065
-0.81%
MAR ’22 Kansas City HRW
$ / BSH
8.4425
8.1625
8.17
-0.0725
-0.88%
MAY ’22 Kansas City HRW
$ / BSH
8.4625
8.1925
8.1925
-0.0775
-0.94%
JUL ’22 Kansas City HRW
$ / BSH
8.45
8.2125
8.2125
-0.065
-0.79%
SEP ’22 Kansas City HRW
$ / BSH
8.465
8.2475
8.2475
-0.0625
-0.75%
DEC ’22 Kansas City HRW
$ / BSH
8.5425
8.32
8.32
-0.06
-0.72%
MAR ’22 MLPS Spring Wheat
$ / BSH
9.72
9.6125
9.635
0.02
0.21%
MAY ’22 MLPS Spring Wheat
$ / BSH
9.6875
9.575
9.605
0.03
0.31%
JUL ’22 MLPS Spring Wheat
$ / BSH
9.6
9.51
9.51
0.005
0.05%
SEP ’22 MLPS Spring Wheat
$ / BSH
9.38
9.2575
9.26
0.0025
0.03%
DEC ’22 MLPS Spring Wheat
$ / BSH
9.3025
9.25
9.2825
0.08
0.87%
MAR ’21 ICE Dollar Index
$
96.34
95.91
96.11
0.037
0.04%
MA ’21 Light Crude
$ / BBL
94.94
92.19
92.6
-0.5
-0.54%
AP ’21 Light Crude
$ / BBL
93.1
90.56
90.91
-0.51
-0.56%
MAR ’22 ULS Diesel
$ /U GAL
2.9605
2.8875
2.897
-0.0139
-0.48%
APR ’22 ULS Diesel
$ /U GAL
2.8464
2.778
2.7871
-0.016
-0.57%
MAR ’22 Gasoline
$ /U GAL
2.7697
2.7137
2.7217
-0.0169
-0.62%
APR ’22 Gasoline
$ /U GAL
2.9022
2.8469
2.8541
-0.0186
-0.65%
MAR ’22 Feeder Cattle
$ / CWT
0
#N/A
166.225
0
0.00%
APR ’22 Feeder Cattle
$ / CWT
0
#N/A
170.7
0
0.00%
FE ’21 Live Cattle
$ / CWT
0
#N/A
141.875
0
0.00%
AP ’21 Live Cattle
$ / CWT
0
#N/A
146.175
0
0.00%
FEB ’22 Live Hogs
$ / CWT
0
#N/A
90.5
0
0.00%
APR ’22 Live Hogs
$ / CWT
0
#N/A
102.225
0
0.00%
FEB ’22 Class III Milk
$ / CWT
20.78
#N/A
20.8
0
0.00%
MAR ’22 Class III Milk
$ / CWT
22.75
22.57
22.75
0.07
0.31%
APR ’22 Class III Milk
$ / CWT
22.86
22.72
22.86
-0.08
-0.35%
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