Afternoon report: Corn and wheat spent Wednesday’s session in the red
Grain prices were mixed but mostly lower as traders ready themselves for the next round of export data, out Thursday morning, and mulled over the latest news from the Federal Reserve, which arrived late in today’s session (more on that below). Corn prices faded moderately lower, while wheat losses were variable – ranging between 0.25% and 1.75%. Soybeans bucked the overall trend, staying slightly above water by the close.
A look at the latest 72-hour cumulative precipitation map from NOAA, most areas east to of the Mississippi River, along with the upper Midwest and Northern Plains, will gather at least some measurable moisture between Thursday and Sunday. NOAA’s new 8-to-14-day outlook predicts a return to seasonally dry weather for the eastern Corn Belt between December 21 and December 27, with sharply lower-than-normal temperatures likely for the central U.S.
On Wall St., the Dow trended 310 points lower in afternoon trading to 33,798 after the Federal Reserve forecasted it will eventually raise interest rates to 5.1% before it closes out the current cycle of hikes. Energy futures were on the rise, with crude oil up nearly 2.5% to $77 per barrel this afternoon. Diesel jumped 6% higher, with gasoline up more than 3.5%. The U.S. Dollar softened slightly.
On Tuesday, commodity funds were net buyers of soybeans (+7,000), soymeal (+2,500) and soyoil (+3,000) contracts but were net sellers of corn (-1,000) and CBOT wheat (-1,000).
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Corn
Corn prices eased off an 11-day high captured on Tuesday following some technical selling on Wednesday. Prices have generally struggled to find much positive traction after hitting a seasonal peak in early October. Today, December futures dropped 4.75 cents to $6.39, with March futures down 2.5 cents to $6.51.
Corn basis bids were mostly steady across the central U.S. on Wednesday but did firm 2 cents higher at an Ohio elevator today.
Ethanol production for the week ending December 9 saw a moderate decline but still posted a solid daily average of 1.061 million barrels, per the latest data from the U.S. Energy Information Administration, out earlier today. Ethanol stocks firmed 5% higher last week.
Prior to Thursday morning’s export report from USDA, analysts expect the agency will show corn sales ranging between 23.6 million and 37.8 million bushels for the week ending December 8.
Due to rainy weather, along with blackouts and other infrastructure challenges, around one-third of Ukraine’s 2022 corn crop has yet to be harvested. In fact, harvest has crawled to a record slow pace, according to analyst UkrAgroConsult. More rain and snow expected in the coming weeks signal that additional fieldwork may be delayed until 2023. Ukraine is the world’s No. 4 corn exporter.
Grain traveling the nation’s railways added another 23,806 carloads last week. That brings cumulative totals for 2022 up to 1.908 million carloads, which is 4.1% below last year’s pace so far.
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Preliminary volume estimates were for 132,006 contracts, shifting moderately below Tuesday’s final count of 196,033.
Soybeans
Soybean prices tested modest gains on Wednesday as traders have generally bullish expectations for tomorrow morning’s export report from USDA. Generally favorable weather in South America kept gains minimized, however. January futures added 3.5 cents to $14.8325, with March futures up 1.25 cents to $14.8575.
Soybean basis bids improved 6 cents at an Ohio elevator while falling 10 cents at an Indiana processor and holding steady elsewhere across the central U.S. on Wednesday.
Analysts are expecting another robust round of soybean sales when USDA releases its next report Thursday morning. Trade guesses ranged between 55.1 million and 77.2 million bushels in combined old and new crop sales for the week ending December 8. Analysts also think USDA will show soymeal sales ranging between 150,000 and 370,000 metric tons, plus up to 5,000 MT of soyoil sales.
Ahead of the next National Oilseed Processors Association (NOPA) report, out Thursday, analysts expect that group to show a total November crush of 181.473 million bushels. That would be the ninth-highest total on record for any month and up 1.12% year-over-year, if realized. Soyoil supplies are expected to move 6% higher to 1.619 billion pounds through November 30.
Interested in learning more about South American production and what it might mean for your bottom line in 2023? Farm Progress is offering a special session featuring Cesar Cruz, director of research with Advance Trading on December 22. Additional sessions next week will diesel trends and maximizing winter shop time. Click here to learn more about this free, seasonal content.
Preliminary volume estimates were for 235,777 contracts, falling slightly below Tuesday’s final count of 251,414.
Wheat
Wheat prices faded lower on Wednesday as a winter storm is pushing much-needed moisture onto the Plains this week. Losses were variable depending on type. March Chicago SRW futures eased 1.5 cents to $7.4925, March Kansas City HRW futures lost 15 cents to $8.5025, and March MGEX spring wheat futures dropped 4.5 cents to $9.1825.
Prior to Thursday morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 5.5 million and 13.6 million bushels for the week ending December 8.
French farm office FranceAgriMer raised its estimates for 2022/23 wheat exports outside of the European Union to 378.5 million bushels, while exports within the EU are expected to decline slightly, to 247.3 million bushels. France is Europe’s top wheat producer and exporter.
Tunisia issued an international tender to purchase 3.7 million bushels of durum wheat from optional origins that closes on Thursday. The grain is for shipment between January 10 and February 25.
Iraq issued a tender to purchase at least 1.8 million bushels of milling wheat from the United States, Canada or Australia that closes on December 18. Iraq routinely purchases more grain than the nominal amount listed on these types of tenders. Additional details about shipment and arrival were not immediately available.
Preliminary volume estimates were for 59,959 CBOT contracts, trending 21% below Tuesday’s final count of 76,265.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Dec
644.25
639
639
-4.75
23-Mar
653.5
646.75
650.5
-2.5
Soybeans
23-Jan
1487
1468
1482.25
3.5
23-Mar
1490.5
1472.5
1485
1.25
Soymeal $/ton
23-Jan
461.8
450.2
460.1
8.2
Soyoil cents/lb
23-Jan
64.76
63.34
63.55
-0.62
Wheat $/bushel
22-Dec
710
728.25
-0.5
23-Mar
751.75
737.75
749.25
-1.5
KC Wheat
22-Dec
869.75
23-Mar
866
840.5
850.25
-15
MPLS Wheat
22-Dec
939.5
23-Mar
922
906.5
922.75
-4.5
Live Cattle cents/lb
22-Dec
155.25
154.5
154.525
-0.375
Feeder Cattle cents/lb
23-Mar
186.025
185.2
185.25
-0.475
Lean Hogs cents/lb
23-Feb
85
83.15
83.325
-1.25
Crude Oil $/barrel
*Energy prices may not represent final settlements
23-Jan
77.75
74.9
77.38
1.99
Diesel
23-Jan
3.2848
3.082
3.2571
0.1649
Unleaded Gasoline $/gallon
23-Jan
2.2521
2.1477
2.244
0.0831
Natural Gas
23-Feb
6.764
6.153
6.186
-0.547
U.S. Dollar Index
22-Dec
104.195
103.505
103.655
-0.288
Gold $/ounce
23-Jan
1817
1800
1797.9
-16
Copper
22-Dec
3.8765
3.827
3.8425
0.003
Fertilizer Swaps
(as of 12/02)
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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