Morning report: Corn fluctuates on dollar, harvest sentiments; Wheat rises on dollar’s losses and tight global supplies. (Comments are updated by 7:30 a.m. Central Time.)
Corn mixed (trading between $0.01-$0.02/bushel worth of gains and losses)
Soybeans up $0.04-$0.08/bushel; Soymeal up $0.50/ton; Soyoil down $1.09/lb
Chicago wheat up 2-4 cents; Kansas City wheat up 8-10 cents; Minneapolis wheat up 4-10 cents
*Prices as of 6:55am CDT.
Feedback from the Field updates! How is harvest progress going on your farm this fall?! Click this link to take the survey and share updates about your farm’s harvest progress. I review and upload results daily to the FFTF Google MyMap, so farmers can see others’ responses from across the country – or even across the county!
I published an updated Feedback from the Field column to our site last Tuesday. Check it out for the best farmer insights from across the country. More harvesting progress has been made over the past week, but it is still slow going as many farmers continue to wait for crops to mature.
Corn
Corn futures traded flat to $0.02/bushel lower this morning as markets braced for quickening harvest paces expected later this week. Some profit-taking could have also been at play, as there were many bullish signals in the corn market this morning which prices largely ignored.
The dollar took a breather from break-neck upward speeds on ever-present recession fears, which boded favorably for U.S. corn demand. U.S. harvest speeds continue to slog at some of the slowest rates over the past five years and Black Sea supplies remain uncertain.
But there is a chance that markets are sensing that corn demand fundamentals are beginning to show signs of weakness, especially after weekly ethanol output recorded a 19-month low last week. Spoiler alert – I have another E-corn-omics column coming today which will dive into some of those market dynamics so stay tuned to our website for more!
USDA’s Crop Progress report released yesterday continued to show slower harvesting speeds, which helped stave off further price losses in the corn market this morning. Through the week ending October 2, 20% of the anticipated 2022 U.S. corn crop had been harvested, up 8% from the previous week but still 2% behind the five-year average.
Pre-report trade guesses once again overshot the mark. Analysts were anticipating that 22% of the crop would be harvested, though the range in which the average guess was calculated varied wildly. Analysts forecasted harvest progress anywhere between 19%-26% complete in yesterday’s report, suggesting the market was uncertain about U.S. harvest speeds over the past week, which limited the report’s bullish price potential in overnight trading.
Despite a slow start to the growing season, corn maturation rates fell in line with historical averages this week. Through last Sunday, 75% of the crop has reached maturation, up a very rapid 17% from the prior week. That development will likely pave the way for more rapid harvest paces this week, weather allowing.
Condition ratings held steady at 52% good to excellent for a third straight week. The reading aligned exactly with pre-report trade estimates.
Soybeans
Even with faster than expected harvesting speeds, soybean prices rose $0.03-$0.05/bushel at last glance on a weakening U.S. dollar, commodity fund buying, and ongoing concerns about Ukrainian oilseed trade flows. Stronger soyoil prices also helped to support the morning’s gains, which were likely capped by faster-than-expected harvest rates.
In direct contrast to corn, markets underestimated soybean harvest progress across the Heartland over the past week, as maturation speeds accelerated rapidly during that time.
Through the week ending October 2, USDA reported in yesterday’s Crop Progress report that 22% of the soybean crop had been harvested, up a rapid 14% from the prior week but still lagging 3% behind the five-year average for the same reporting period.
Pre-report analyst estimates had pegged the value at 20% with a range of 14%-28% reported, 2% behind USDA’s values reported yesterday. But it is still early in the growing season, which likely is the reason why markets shrugged off the faster than expected harvesting speeds in this morning’s trading session.
About 81% of the U.S. soybean crop has dropped its leaves. That value rose a rapid 18% from last week’s report and was 2% of the five-year average for the same reporting period. USDA reported 55% of U.S. soybeans to be in good to excellent condition as of October 2, unmoved from the previous week’s reading.
Wheat
After reporting losses in yesterday’s trading session, wheat prices reverted back into the green this morning thanks to a weaker U.S. dollar and lingering concerns about tight global supplies following last week’s USDA reports and worries about Russian and Ukrainian grain supplies.
Russia’s illegal annexation of four of Ukraine’s eastern states will create even more complications for global wheat (and also other grains and oilseeds) forecasters in the coming months.
“Considering the arable land that exists there, I think at least 5 million tonnes of grain will be added to the Russian savings box. I also think that we’ll get other crops,” Russian Agriculture Minister Dmitry Patrushev told Russian state news agency, TASS, overnight.
For comparison, that would be like if Canada decided to take over North Dakota’s crop acreage and report it as its own. While that would inevitably make USDA’s life easier, 1) it’s still illegal by international law to take another country’s land and 2) that just makes forecasting Canadian crops more difficult.
Statistically speaking, this is a bit of a nightmare for forecasters, especially for the World Ag Outlook Board, the USDA division responsible for the creation and evaluation of the World Agricultural Supply and Demand Estimates (WASDE) report. This will make it increasingly difficult for forecasters and market watchers alike to make the apples-to-apples comparisons between Ukrainian and Russian grain production in year-over-year calculations because it will not be a similar enough comparison.
This could make next week’s WASDE report interesting if WAOB decides to adjust Russian and Ukrainian grain exports and production estimates to reflect this dynamic.
Russia illegally annexed about 18% of Ukraine’s land in an unsanctioned – and at times, violently forced – election in the partially occupied Ukrainian territories. Many other countries – including key Russian ally, China – condemned the illegal referendums last week.
Winter wheat planting progress slowed over the past week, with a slow corn harvest likely delaying some sowing progress in areas of the Heartland. Through the week ending October 2, 40% of the 2023 winter wheat crop had been planted, up just 9% from the previous week and falling 4% behind the five-year average for the same reporting period.
Markets had been expecting USDA to report the progress at 44% complete, which would have aligned it with the five-year average benchmark. Emergence rates also lost some momentum during the past week, with USDA reporting 15% of the crop emerged, up 6% from the previous week but 2% below the five-year average.
USDA ended its reporting on spring wheat harvest last week as most of the crop has largely been completed for the season.
Weather
It’s likely to be another warm day across the Heartland, with highs reaching the 80s and 90s in the Central and Southern Plains and topping out in the 70s elsewhere in the Midwest, according to NOAA’s short-term forecasts. That forecast should help to accelerate maturation speeds and keep combines running at a steady clip over the next week.
Growers in the Northern and Central Plains will battle more showers by this evening, with some of that precipitation expected to creep into the Upper Midwest by Wednesday and Thursday. The showers are likely to be light, though South Dakota and Eastern Nebraska could see up to a half inch of accumulation over the next 24 hours.
The favorable weather conditions will likely continue into the middle of October. NOAA’s 6-10-day outlook is showing cooler temperature probabilities for continental region to the east of the Mississippi River, though chances for perception continue to hover below average for much of the country during that time. The 8-14-day outlook is still trending slightly warmer and continues to show below average chances for precipitation for the entire Heartland through the end of next week.
That’s good news for corn, soybean, and spring wheat growers eager to make significant strides on harvest progress over the next two weeks. But for growers in the Plains who are eager to receive moisture for newly planted winter wheat crops, the next couple weeks could be a little more anxiety-producing if no rains move into the Plains.
Financials
Stock futures continued to gain momentum overnight after yesterday’s rally, moving up 1.65% to $3,751 this morning as markets continue to take a breather following last week’s bearish run on Wall Street to close out the third quarter of the 2022 year.
“There are so many tensions and crises currently coming together,” Carsten Brzeski, ING Groep’s global head of macro research, told the Wall Street Journal this morning. “That’s leading to enormous volatility and uncertainty in markets.”
Nerd alert
It’s Nobel Prize week, which is one of my favorite times of the year! Today’s award for physics was awarded to Alain Aspect from France, John F. Clauser from the U.S., and Anton Zeilinger from Austria. The trio was recognized for their work with entangled photons, which resulted in significant advances in the field of quantum mechanics.
What else I’m reading this morning on our website, FarmFutures.com:
My latest E-corn-omics column digs into the great wheat disappearance of 2022.
Water Street Solution’s Darren Frye explains how can continue to move forward when uncertainty runs high.
Bryce Knorr evaluates whether harvest prices will make cash sales a better choice than storage for 2022 corn and soybeans.
Our team’s coverage of Friday’s USDA reports!
Naomi Blohm reminds market watchers that China still needs soybeans.
Morning Ag Commodity Prices – 10/4/2022
Contract
Units
High
Low
Last
Net Change
% Change
DEC ’22 CORN
$ / BSH
6.84
6.765
6.805
-0.0025
-0.04%
MAR ’23 CORN
$ / BSH
6.905
6.8325
6.8725
-0.0025
-0.04%
MAY ’23 CORN
$ / BSH
6.9075
6.8425
6.8775
-0.0025
-0.04%
JUL ’23 CORN
$ / BSH
6.845
6.785
6.815
-0.0025
-0.04%
SEP ’23 CORN
$ / BSH
6.3
6.28
6.28
-0.0125
-0.20%
DEC ’23 CORN
$ / BSH
6.165
6.1225
6.145
-0.0075
-0.12%
AR2 ’24 CORN
$ / BSH
6.225
#N/A
6.22
0
0.00%
AY2 ’24 CORN
$ / BSH
6.245
#N/A
6.24
0
0.00%
JUL ’24 CORN
$ / BSH
6.1975
6.1975
6.1975
-0.005
-0.08%
NOV ’22 SOYBEANS
$ / BSH
13.8
13.7175
13.7925
0.0525
0.38%
JAN ’23 SOYBEANS
$ / BSH
13.8975
13.8125
13.885
0.045
0.33%
MAR ’23 SOYBEANS
$ / BSH
13.97
13.8825
13.9575
0.04
0.29%
MAY ’23 SOYBEANS
$ / BSH
14.045
13.96
14.035
0.04
0.29%
JUL ’23 SOYBEANS
$ / BSH
14.07
13.9875
14.06
0.04
0.29%
AUG ’23 SOYBEANS
$ / BSH
13.915
13.84
13.9075
0.035
0.25%
SEP ’23 SOYBEANS
$ / BSH
13.5875
13.58
13.58
-0.0025
-0.02%
NOV ’23 SOYBEANS
$ / BSH
13.51
13.4175
13.51
0.05
0.37%
AN2 ’24 SOYBEANS
$ / BSH
13.4825
13.445
13.445
-0.04
-0.30%
AR2 ’24 SOYBEANS
$ / BSH
13.455
#N/A
13.435
0
0.00%
AY2 ’24 SOYBEANS
$ / BSH
0
#N/A
13.415
0
0.00%
OCT ’22 SOYBEAN OIL
$ / LB
66.5
#N/A
66.88
0
0.00%
DEC ’22 SOYBEAN OIL
$ / LB
64.25
63.27
64.23
0.89
1.41%
OCT ’22 SOY MEAL
$ / TON
409.3
408.9
409.3
3.7
0.91%
DEC ’22 SOY MEAL
$ / TON
408
404.8
405.7
0.4
0.10%
JAN ’23 SOY MEAL
$ / TON
404.8
401.9
403
0.5
0.12%
MAR ’23 SOY MEAL
$ / TON
400.1
397.6
397.9
-0.4
-0.10%
MAY ’23 SOY MEAL
$ / TON
397.6
395.1
395.6
-0.2
-0.05%
DEC ’22 Chicago SRW
$ / BSH
9.19
9.0575
9.1475
0.0275
0.30%
MAR ’23 Chicago SRW
$ / BSH
9.32
9.1875
9.27
0.02
0.22%
MAY ’23 Chicago SRW
$ / BSH
9.3875
9.26
9.3375
0.025
0.27%
JUL ’23 Chicago SRW
$ / BSH
9.2025
9.1025
9.14
0.03
0.33%
SEP ’23 Chicago SRW
$ / BSH
9.1475
9.0925
9.105
0.06
0.66%
DEC ’23 Chicago SRW
$ / BSH
9.1575
9.0175
9.12
0.08
0.88%
AR2 ’24 Chicago SRW
$ / BSH
9.0475
9.045
9.0475
0.0625
0.70%
DEC ’22 Kansas City HRW
$ / BSH
10.0075
9.875
9.98
0.0925
0.94%
MAR ’23 Kansas City HRW
$ / BSH
9.975
9.8425
9.9325
0.0775
0.79%
MAY ’23 Kansas City HRW
$ / BSH
9.9375
9.815
9.9
0.08
0.81%
JUL ’23 Kansas City HRW
$ / BSH
9.7125
9.59
9.685
0.0875
0.91%
SEP ’23 Kansas City HRW
$ / BSH
9.545
9.545
9.545
0.0675
0.71%
DEC ’23 Kansas City HRW
$ / BSH
9.5
9.5
9.5
0.0325
0.34%
AR2 ’24 Kansas City HRW
$ / BSH
0
#N/A
9.3775
0
0.00%
DEC ’22 MLPS Spring Wheat
$ / BSH
9.8925
9.7725
9.8375
0.0375
0.38%
MAR ’23 MLPS Spring Wheat
$ / BSH
9.945
9.8375
9.8775
0.02
0.20%
MAY ’23 MLPS Spring Wheat
$ / BSH
9.985
9.985
9.985
0.095
0.96%
JUL ’23 MLPS Spring Wheat
$ / BSH
9.85
9.8375
9.85
0.025
0.25%
SEP ’23 MLPS Spring Wheat
$ / BSH
9.4525
9.4525
9.4525
0.0075
0.08%
DEC ’23 MLPS Spring Wheat
$ / BSH
9.4775
#N/A
9.375
0
0.00%
AR2 ’24 MLPS Spring Wheat
$ / BSH
0
#N/A
0
0
0.00%
DEC ’21 ICE Dollar Index
$
111.825
110.91
111.12
-0.536
-0.48%
NO ’21 Light Crude
$ / BBL
84.94
83.22
84.78
1.15
1.38%
DE ’21 Light Crude
$ / BBL
84.02
82.33
83.86
1.16
1.40%
NOV ’22 ULS Diesel
$ /U GAL
3.4633
3.3547
3.4581
0.089
2.64%
DEC ’22 ULS Diesel
$ /U GAL
3.3317
3.2374
3.3279
0.0764
2.35%
NOV ’22 Gasoline
$ /U GAL
2.577
2.5157
2.5743
0.0614
2.44%
DEC ’22 Gasoline
$ /U GAL
2.44
2.3901
2.4379
0.0447
1.87%
OCT ’22 Feeder Cattle
$ / CWT
0
#N/A
175.525
0
0.00%
NOV ’22 Feeder Cattle
$ / CWT
0
#N/A
176.05
0
0.00%
CT2 ’21 Live Cattle
$ / CWT
0
#N/A
144.325
0
0.00%
DE ’21 Live Cattle
$ / CWT
0
#N/A
148.025
0
0.00%
OCT ’22 Live Hogs
$ / CWT
0
#N/A
88.775
0
0.00%
DEC ’22 Live Hogs
$ / CWT
0
#N/A
77.725
0
0.00%
SEP ’22 Class III Milk
$ / CWT
19.83
19.83
19.83
-0.01
-0.05%
OCT ’22 Class III Milk
$ / CWT
22.2
22.19
22.19
-0.01
-0.05%
NOV ’22 Class III Milk
$ / CWT
21.39
21.36
21.39
0.01
0.05%
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