Afternoon report: Overnight corn gains mostly evaporate in Friday’s session, while wheat slumps moderately lower
Soybean prices enjoyed the biggest weekly gain in more than two decades after trending another 2% higher Friday as traders remained focused on the ample hot, dry weather that is expected across the central U.S. in early August. Corn also moved moderately higher, although prices were even better in overnight trading. Wheat continued to slide lower, however, with some contracts down nearly 2% today.
Most of the Midwest and Plains will see at least some measurable moisture between Saturday and Tuesday, with some areas of the Mid-South set to gather another 1″ to 2″ during this time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s new 8-to-14-day outlook predicts a return to seasonally dry weather for the Central Plains and western Corn Belt between August 5 and August 11, with hotter-than-normal conditions prevalent across the entire central U.S.
On Wall St., the Dow moved another 266 points higher in afternoon trading to 32,796 and is on pace for 6% gains in July (the best monthly total in more than a year). Investor sentiment appears to be fueled by hopes that inflation has peaked and is now back on a downward slide. Energy futures were mixed. Crude oil climbed 2.5% to near $99 per barrel, with gasoline firming around 0.4%. In contrast, diesel dropped 2% in afternoon trading. The U.S. Dollar softened moderately.
On Thursday, commodity funds were net buyers of corn (+11,000), soybeans (+11,000), soyoil (+9,000) and CBOT wheat (+9,000) contracts but were net sellers of soymeal (-2,000).
NOTE: Farm Futures is conducting its annual August survey, which will help farmers anticipate this season’s corn and soybean yield prospects and provide a sneak peek at 2023 acreage intentions. Farm Futures grain market analyst Jacqueline Holland will announce the results of these findings at the 2022 Farm Progress Show. We hope you will participate – this is one of the few exclusively farmer-sourced estimates on the market. Click here to get started.
Corn
Corn prices trended higher again on Friday, closing the week with gains of more than 10% – the best weekly performance since early March. Traders remain focused on weather forecasts for now, and surging soybean prices lent additional support. September futures added 3.5 cents to $6.1850, with December futures up 3.25 cents to $6.2225.
Corn basis bids were largely steady across the central U.S. on Friday with one major exception after tumbling 20 cents lower at an Illinois processor today.
Hot, dry conditions in France has the country’s corn crop on its heels, with the country’s FranceAgriMer farm office reporting a seven-point quality decline this past week. Sixty-eight percent of the crop is now rated in good-to-excellent condition through July 25. France is Europe’s No. 1 grain producer.
An ongoing protest by federal revenue service auditors in Brazil has caused delays to payments for recent corn exports. “The scenario is shaping up to be much worse [than it has been],” according to Sergio Mendes, director general of Anec. The auditors have made several demands that include hiring more staff and receiving raises and performance-based bonuses.
Senate Majority Leader Chuck Schumer, D-N.Y., and Sen Joe Manchin, D-W.V., announced they have reached an agreement on a tax, climate and healthcare package called the Inflation Reduction Act of 2022. This would include $40 billion in funding for climate-smart agriculture and biofuels. Farm Futures policy editor took a closer look and gauged various industry reactions – click here to learn more.
“Owners’ time is precious, and we’ve found certain employee activities drain that time,” according to Tim Schaefer, founder of Encore Wealth Advisors. “Stack those time drains together, and leadership ends up managing the daily whirlwind of urgent but not necessarily critical tasks.” Schaefer takes a closer look at the five levels of employees in his latest Transitions and Strategies blog – click here to learn more.
Preliminary volume estimates were for 313,463 contracts, which was well above Thursday’s final count of 205,358.
Soybeans
Soybean prices shot up another 2% higher on another round of technical buying on Friday, closing out the best week in 22 years after trending more than 11% higher since Monday morning. Unfavorable weather forecasts have been the primary driver, although a flash sale announced this morning added more fuel for the bulls today. August futures rose 23.25 cents to $16.4150, with September futures up 35.25 cents to $14.9225.
Soybean basis bids were steady to weak after falling 10 to 15 cents lower at two interior river terminals and dropping 10 cents at an Indiana processor on Friday.
Private exporters announced the sale of 4.9 million bushels of soybeans for delivery to unknown destinations during the 2022/23 marketing year, which begins September 1.
China plans to auction off another 18.4 million bushels of its state imported soybean reserves on August 5. The country has offered a series of similarly sized auctions since this spring to increase local supplies and ease the pressure of high prices.
If it’s been a few days since you’ve been to FarmFutures.com, our Friday feature “7 ag stories you might have missed” is a good way to quickly catch up on the ag industry’s top headlines. The latest batch of content includes stories on the Federal Reserve’s latest interest rate hike, an ongoing farmer protest in the Netherlands and more. Click here to get started.
Preliminary volume estimates were for 213,966 contracts, moving moderately above Thursday’s final count of 166,375.
Wheat
Wheat prices continued to shift lower on hopes that Ukrainian grain exports will be able to leave port cities soon following a recent UN-helmed agreement. September Chicago SRW futures faded 5.25 cents to $8.1175, September Kansas City HRW futures dropped 10 cents to $8.7975, and September MGEX spring wheat futures lost 15.75 cents to $9.1225.
Ukrainian President Volodymyr Zelenskiy made a rare trip outside of Kyiv earlier today, visiting a port near the southern city of Odesa. Black Sea ports are still waiting to move grain after the United Nations brokered a deal earlier this week to get container ships moving again. Reports show that 17 ships are currently docked at Ukrainian ports, holding an estimated 600,000 metric tons of cargo.
Meantime, a Turkish grains trading company is denying allegations that flour and barley in a ship docked in Lebanon was stolen from Ukraine. A company official said Lebanese customs were supplied with documentation showing the grain was sourced from Russia but declined to share these documents with Reuters.
French farm office FranceAgriMer reported that 95% of this season’s soft wheat crop has been harvested through July 25, up from 84% a week earlier. And 63% of the crop is rated in good-to-excellent condition, unchanged from a week ago.
South Korea purchased 1.5 million bushels of milling wheat, sourced from Canada, in an international tender that closed earlier today. The grain is for shipment between mid-October and mid-November.
Preliminary volume estimates were for 89,195 CBOT contracts, shifting moderately above Thursday’s final count of 63,331.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Sep
632
611.5
616.25
3.5
22-Dec
636.5
616
620
3.25
Soybeans
22-Sep
1516
1452.75
1487.25
35.25
22-Dec
1489
1435.5
1468.5
33
Soymeal $/ton
22-Sep
461.3
441.8
442.4
1.5
Soyoil cents/lb
22-Sep
66.9
63.54
66.5
2.39
Wheat $/bushel
22-Sep
845.75
801
807.75
-5.25
22-Dec
863.75
819.25
825.75
-5.25
KC Wheat
22-Sep
915.25
870.5
874.5
-10
22-Dec
921.5
877.5
881.5
-9.75
MPLS Wheat
22-Sep
947
899
906
-15.75
22-Dec
959.5
911.5
918.5
-18.25
Live Cattle cents/lb
22-Aug
136.85
135.95
136.3
0.125
Feeder Cattle cents/lb
22-Sep
181.925
178.275
181.675
1.475
Lean Hogs cents/lb
22-Oct
97.375
95.55
97.225
0.9
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Sep
101.88
96.41
98.94
2.52
Diesel
22-Aug
3.7858
3.6043
3.6043
-0.082
Unleaded Gasoline $/gallon
22-Aug
3.715
3.3663
3.3663
-0.0983
Natural Gas
22-Oct
8.356
7.995
8.276
0.158
U.S. Dollar Index
22-Sep
106.535
105.41
105.805
-0.431
Gold $/ounce
22-Sep
1769.7
1754
1762.5
12.2
Copper
22-Aug
3.578
3.491
3.578
0.103
Fertilizer Swaps
(as of 07/29)
DAP Tampa-index
916.5
0
DAP-New Orleans
837.8
-1.65
Urea-New Orleans
581.5
22.05
Urea-Middle East
707.5
37.5
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
439.8
-8.27
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