Afternoon report: Corn and soybean prices also spilled into the red on Wednesday.
The fate of grain prices – and wheat prices in particular – are closely tied to the ongoing Russia/Ukraine conflict. Today, news from Ukrainian President Volodymyr Zelenskiy that negotiations “already sound more realistic” infused fresh hope of a ceasefire. Because Ukraine and Russia are both significant wheat exporters, prices tumbled sharply, closing with limit-down losses. Corn prices also took a big hit, falling more than 3.5% lower today. Soybeans only suffered a moderate setback, meantime, fading 0.5%.
Expect more rainy weather for parts of the Midwest and Plains between Thursday and Saturday, per the latest 72-hour cumulative precipitation map from NOAA. A band stretching from eastern Kansas through northwest Indiana could gather another 1″ during this time. NOAA’s new 8-to-14-day outlook predicts seasonally dry weather for much of the Plains and western Corn Belt between March 23 and March 29, with warmer-than-normal conditions prevalent throughout the Great Plains.
On Wall St., the Dow spilled into the red, dropping 68 points in afternoon trading to 33,475 on news that the Federal Reserve raised interest rates by 0.25% and is anticipating six additional rate hikes this year. Energy futures were mixed. Crude oil dropped another 1.25% in afternoon trading to $95 per barrel. Gasoline was also down slightly, while diesel trended moderately higher. The U.S. Dollar softened slightly.
On Tuesday, commodity funds were net buyers of corn (+2,500) and CBOT wheat (+19,000) contracts but were net sellers of soybeans (-7,500), soymeal (-1,000) and soyoil (-1,500).
Corn
Corn prices stumbled to 3.5% losses as talks of a ceasefire in Ukraine would help that country quickly ramp up its corn exports and quell fears of tight global supplies. May futures dropped 27.5 cents to $7.3050, with July futures down 26.75 cents to $6.9650.
Corn basis bids dipped a penny lower at an Ohio river terminal and dropped 8 cents at an Ohio elevator while holding steady at other Midwestern locations on Wednesday.
Ethanol production shifted slightly lower for the week ending March 11, with a daily average of 1.026 million barrels, per the latest data from the U.S. Energy Information Administration. Despite the modest move lower, weekly production remained near the best levels since late January. Stocks increased another 3% and are at the highest level in nearly two years.
Ahead of tomorrow morning’s export report from USDA, analysts expect the agency to show corn sales ranging between 27.6 million and 63.0 million bushels for the week ending March 10.
There’s growing optimism that negotiations between Russian and Ukraine will be fruitful and end the conflict sooner rather than later. Even so, experts warn that the invasion will have long-term impacts that could stretch out months or even years beyond a ceasefire. Click here to learn more.
Iran issued an international tender to purchase 2.4 million bushels of feed corn, 2.8 million bushels of animal feed barley and 60,000 metric tons of soymeal from optional origins that closes today. The grain is for shipment in April and May.
Preliminary volume estimates were for 219,176 contracts, tracking moderately higher than Tuesday’s final count of 170,198.
Soybeans
Soybean prices tested moderate gains this morning but ultimately closed down around 0.5% after spillover weakness from corn and wheat led to some technical selling. May futures fell 8.5 cents to $16.5025, with July futures down 9.5 cents to $16.2625.
Soybean basis bids fell 4 cents at an Ohio elevator but held steady elsewhere across the central U.S. on Wednesday.
Ahead of Thursday morning’s export report from USDA, analysts think the agency will show another large round of soybean sales for the week ending March 10, with trade guesses ranging between 51.4 million and 110.2 million bushels. Analysts also expect to see soymeal sales ranging between 100,000 and 325,000 metric tons, plus up to 45,000 MT of soyoil sales.
Before the busy planting season kicks into full swing, you’ll have a chance to rally the troops, make sure all equipment is running smoothly, fine-tune your marketing plan and do everything else in your control to align yourself for another strong season. What ingredients will be most important in your recipe for success in 2022? Click here and read the latest Farm Futures cover story to learn more.
What’s the most you’re paying for rented ground in 2922? That was the latest question asked by the Farm Progress PANEL survey, and here’s a look at the responses. Click here for additional insights.
Preliminary volume estimates were for 98,782 contracts, sliding slightly below Tuesday’s final count of 106,953.
Wheat
Wheat prices were slashed on reports that peace negotiations between Russia and Ukraine have made some progress. Russia and Ukraine combined account for nearly one third of global wheat exports. Prices ultimately hit limit-down losses and stayed there until the close today. May Chicago SRW futures tumbled 85 cents to $10.6925, May Kansas City HRW futures tumbled 85 cents to $10.7250, and May MGEX spring wheat futures dropped 60 cents to $10.5025.
Ahead of tomorrow morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 9.2 million and 25.7 million bushels for the week ending March 10.
Brazil exported an unprecedented amount of wheat between December and March, reaching 91.9 million bushels during that stretch. That was driven largely by a better-than-expected harvest last season and was exacerbated by Russia’s invasion of Ukraine. “Farmers want to plant wheat,” according to Oswaldo Vieira, an analyst with Embrapa Trigo. “One of the [primary] factors is having liquidity … and exports are a very important path for this.” Some analysts think Brazil’s wheat acreage could double in just a few years.
The Philippines issued a series of tenders to purchase a total of 9.9 million bushels of animal feed wheat from optional origins that closes today. The grain is comprised of four consignments and is for shipment starting in early May.
Jordan again passed on all offers in its international tender to purchased 4.4 million bushels of milling wheat that closed earlier today. A new tender is expected to be issued that will close on March 24.
Iran issued an international tender to purchase 2.2 million bushels of milling wheat from optional origins that closes today. The grain is for shipment in April and May.
Bangladesh has received multiple offers in its international tender to buy 1.8 million bushels of wheat, but no deals have been closed at this time. The grain would be for shipment 40 days after a contract is signed.
Preliminary volume estimates were for 91,023 CBOT contracts, moving 18% above Tuesday’s final count of 76,999.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-May
757
726.75
730
-27.5
22-Jul
722.5
693.25
697
-26.75
Soybeans
22-May
1681.25
1645.25
1649.25
-8.5
22-Jul
1656.25
1622.25
1626
-9.5
Soymeal $/ton
22-Jul
475.3
462.9
465.7
-4.1
Soyoil cents/lb
22-Jul
70.77
69.02
69.57
-0.15
Wheat $/bushel
22-May
1159.5
1069.25
1069.25
-85
22-Jul
1129
1042.5
1042.5
-85
KC Wheat
22-May
1160.25
1072.5
1072.5
-85
22-Jul
1145
1058.5
1058.5
-85
MPLS Wheat
22-May
1110.75
1050.25
1050.25
-60
22-Jul
1094
1034.25
1037.75
-60
Live Cattle cents/lb
22-Apr
141.475
139.25
139.325
-1.525
Feeder Cattle cents/lb
22-Apr
164.775
162.45
162.725
0.125
Lean Hogs cents/lb
22-May
112.5
110.6
111.025
0.375
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Apr
99.22
94.07
95.29
-1.15
Diesel
22-Apr
3.1703
2.974
3.116
0.0863
Unleaded Gasoline $/gallon
22-Apr
3.0948
2.9439
2.9842
-0.0139
Natural Gas
22-May
4.812
4.645
4.793
0.176
U.S. Dollar Index
22-Jun
99.1
98.3
98.635
-0.429
Gold $/ounce
22-Jun
1928.7
1895.2
1908.9
-19.6
Copper
22-Mar
4.61
4.4925
4.5795
0.078
Fertilizer Swaps
(as of 03/11)
DAP Tampa-index
895.0
27.5
DAP-New Orleans
1,047.2
68.89
Urea-New Orleans
901.1
168
Urea-Middle East
1,002.5
172
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
661.4
52.36
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