Afternoon report: Soybeans also trend higher on Wednesday, with corn down moderately
Grain prices were mixed but mostly higher in midweek trading. Wheat prices saw the biggest boost after capturing double-digit gains today, although CBOT wheat contracts close November with monthly losses of nearly 10%. Soybeans also saw decent forward momentum, rising another 0.7% following another round of technical buying. Corn failed to follow suit, suffering a moderate technical setback today.
NOAA’s latest 72-hour cumulative precipitation map shows that light rain and snow is possible for parts of the Northern Plains and eastern Corn Belt between Thursday and Sunday, although large portions of the central U.S. shouldn’t see any additional measurable moisture during this time. NOAA’s new 8-to-14-day outlook predicts seasonally dry weather returning to the Great Lakes region between December 7 and December 13, with cooler-than-normal conditions likely for the northern half of the U.S. next week.
On Wall St., the Dow improved 410 points in afternoon trading to 34,262 on optimism that future interest rate hikes won’t be as severe as they have been earlier this year. Energy futures made solid inroads, with crude oil up nearly 3% this afternoon to move back above $80 per barrel. Diesel firmed 2.5%, while gasoline jumped 4% higher. The U.S. Dollar softened considerably.
On Tuesday, commodity funds were net buyers of soybeans (+1,000) and CBOT wheat (+1,000) but were net sellers of corn (-1,000) and soymeal (-3,000). Funds were roughly even when trading soyoil contracts yesterday.
Corn
Corn prices suffered a moderate technical setback, sinking around 0.75% lower following a round of technical selling spurred by worries that exports are slowing down. December futures dropped 5.75 cents to $6.60, with March futures down 3.5 cents to $6.66.
Corn basis bids were steady to weak after fading 1 to 10 cents lower across half a dozen Midwestern locations on Wednesday.
Ethanol production took a moderate step lower in the week ending November 25, with a daily average of 1.018 million barrels, per the latest data from the U.S. Energy Information Administration, out earlier today. Stocks were up less than 1% but still reached a 25-week high.
Meantime, a bill that would ensure permanent year-round access to E15 was introduced by a bipartisan group of U.S. Senators earlier this week. Click here to learn more about the Consumer and Fuel Retailer Choice Act and read statements from various industry groups.
Ahead of Thursday morning’s export report from USDA, analysts expect the agency to show corn sales ranging between 18.7 million and 43.3 million bushels for the week ending November 24.
Grain traveling the nation’s railways saw another 20,261 carloads last week. That brings cumulative totals for 2022 to 1.048 million carloads, which is trending 4% below last year’s pace so far.
Two South Korean feedmill groups purchased a total of 5.3 million bushels of animal feed corn in private deals that closed earlier this week. The grain is likely sourced from South America and is for shipment beginning in January.
Preliminary volume estimates were for 199,539 contracts, trending nearly 40% below Tuesday’s final count of 331,969.
Soybeans
Soybean prices stayed firm on Tuesday, rising more than 0.5% higher on general demand optimism following another flash sale to China announced this morning. January futures rose 10 cents to $14.6950, with March futures up 9.25 cents to $14.7525.
Soybean basis bids were mostly steady across the central U.S. on Wednesday but did tilt 5 cents higher at an Ohio elevator and 5 cents lower at an Iowa processor today.
Private exporters reported to USDA the sale of 5.0 million bushels of soybeans for delivery to China during the 2022/23 marketing year, which began September 1.
Prior to tomorrow morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 17.5 million and 40.4 million bushels for the week ending November 24. Analysts also expect to see soymeal sales ranging between 15,000 and 550,000 metric tons, plus up to 30,000 MT of soyoil sales.
Ahead of a USDA report out tomorrow afternoon, analysts expect the agency to show total soybean crush in October at 195.9 million bushels. If realized, that would be substantially higher than September’s one-year low of 167.6 million bushels and the third-largest October crush on record. Analysts also expect to see U.S. soyoil stocks up to 2.107 billion pounds through the end of October.
Preliminary volume estimates were for 160,471 contracts, sliding moderately below Tuesday’s final count of 189,815.
Wheat
Wheat prices found plenty of positive forward momentum after a round of technical buying and short-covering on Wednesday, with most contracts rising 1.5% to 2% higher today. December Chicago SRW futures gained 13.25 cents to $7.71, December Kansas City HRW futures added 13 cents to $9.14, and December MGEX spring wheat futures rose 21.75 cents to $9.62.
Prior to USDA’s next export report, out Thursday morning, analysts think the agency will show wheat sales ranging between 11.0 million and 26.6 million bushels for the week ending November 24.
USDA released its last crop progress report of 2022 earlier this week and will resume them again starting on April 3, 2023. In yesterday’s report, USDA noted that winter wheat quality ratings improved two points for the week ending November 27, with 34% of the crop in good-to-excellent condition. Another 40% is rated fair (up five points from last week), with the remaining 26% rated poor or very poor (down seven points from last week). Physiologically, 91% of the crop is now emerged, which is mostly in line with 2021’s pace of 91% and the prior five-year average of 90%.
Pakistan received multiple offers in its international tender to purchase 18.4 million bushels from optional origins that closed earlier today. Additional details of the sale were not immediately available, although Russia was expected to be a major source of the grain, which is for shipment between December 16 and February 8.
China plans to auction another 1.5 million bushels of its imported state wheat reserves on December 7. The country has held a series of similarly sized auctions earlier this fall in an attempt to boost local supplies.
Preliminary volume estimates were for 69,000 CBOT contracts, falling moderately below Tuesday’s final count of 83,610.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Dec
667
660
662
-5.75
23-Mar
672.5
664.25
667
-3.5
Soybeans
23-Jan
1478.5
1457.25
1469.5
10
23-Mar
1484
1463.75
1475.5
9.25
Soymeal $/ton
23-Jan
419.5
407.4
417.8
10.4
Soyoil cents/lb
23-Jan
73.99
70.83
71.88
-1.22
Wheat $/bushel
22-Dec
772.75
757.25
771.5
13.25
23-Mar
799.25
781.5
795.5
13.25
KC Wheat
22-Dec
919.25
901.5
913.25
13
23-Mar
905
888.25
899.75
12.75
MPLS Wheat
22-Dec
962
939.5
956.75
21.75
23-Mar
945.25
930
943
8.25
Live Cattle cents/lb
22-Dec
153.5
152.25
153.05
0.375
Feeder Cattle cents/lb
23-Mar
183.625
180.475
183.625
2.45
Lean Hogs cents/lb
23-Feb
85.95
83.725
85.625
1.475
Crude Oil $/barrel
*Energy prices may not represent final settlements
23-Jan
81.38
78.4
80.69
2.49
Diesel
22-Dec
3.401
3.3037
3.3823
0.0864
Unleaded Gasoline $/gallon
22-Dec
2.435
2.332
2.4238
0.0917
Natural Gas
23-Feb
7.159
6.7
6.853
-0.231
U.S. Dollar Index
22-Dec
107.15
105.875
105.9
-0.868
Gold $/ounce
23-Jan
1776.5
1751.8
1768.3
19.9
Copper
22-Dec
3.779
3.627
3.779
0.149
Fertilizer Swaps
(as of 11/18)
DAP Tampa-index
692.0
-8
DAP-New Orleans
630.0
0
Urea-New Orleans
512.5
0
Urea-Middle East
556.5
-31
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
535.0
0
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