Afternoon report: Corn and soybean prices also in the red in Thursday’s session
Concerns of a possible global economic slowdown kicked a broad range of commodities lower after an ensuing round of technical selling on Thursday. Wheat prices were affected the most severely, with most contracts losing between 4% and 5% today. Corn and soybeans each faded around 2.25% lower by the close.
Some light rains are returning to parts of the Corn Belt between Friday and Monday, but few places will gather much more than 0.25″ during that time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts that seasonally wet conditions will return to a large portion of the central U.S. between September 8 and September 14, with warmer-than-normal weather likely for most of the U.S.
On Wall St., the Dow trended 35 points higher in afternoon trading to 31,545 after rebounding from a 290-point drop this morning. Still, the Dow is on pace for a 2.7% weekly decline so far after skittish investors continue to worry over the Federal Reserve’s aggressive interest rate stance. Energy futures saw significant cuts, with crude oil down nearly 3.5% this afternoon to $86 per barrel. Diesel dropped 3%, with gasoline down more than 2%. The U.S. Dollar firmed significantly.
On Wednesday, commodity funds were net buyers of soyoil (+3,000) and CBOT wheat (+5,000) contracts but were net sellers of corn (-5,500), soybeans (-6,000) and soymeal (-5,500).
NOTE: USDA announced yesterday afternoon that it will not be releasing grain export sales data for the next two weeks as it tries to sort out technical issues that arose when the agency attempted to launch its upgraded Export Sales Reporting and Maintenance System 2.0, or ESRMS 2.0. “We expect to resume regular reporting on Thursday, Sept. 15,” according to the agency’s statement, which you can read in full here.
Corn
Corn prices were among several commodities in the crosshairs on Thursday, incurring double-digit losses following a round of technical selling today. September futures dropped 15 cents to $6.5875, with December futures down 12 cents to $6.5850.
Corn basis bids were mostly steady to weak after tumbling 60 cents lower at a Nebraska elevator and fading 5 to 13 cents lower at four other Midwestern locations on Thursday. An Iowa ethanol plant bucked the overall trend after climbing 25 cents higher today.
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Indonesia purchased 2.6 million bushels of food-quality corn, which is expected to be sourced from the United States or South America. The grain is for shipment in November.
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Preliminary volume estimates were for 219,362 contracts, which was slightly below Wednesday’s final tally of 221,420.
Soybeans
Soybean prices followed a wide set of other commodities lower on Thursday after a round of technical selling slashed prices by 2% to 2.25%. September futures lost 35.25 cents to $14.7225, with November futures down 27.75 cents to $13.9475.
Soybean basis bids were steady at most Midwestern locations on Thursday but did tilt 33 cents lower at an Ohio elevator today.
Private exporters announced to USDA the sale of 14.6 million bushels of soybeans for delivery to unknown destinations during the 2022/23 marketing year.
Argentina’s grain exports in August were valued at $3.4 billion, rising 5% from July and bringing year-to-date totals to a record pace of $25.7 billion. Argentina is among the world’s top exporters of several commodities, including soymeal, soyoil and corn.
South Korean importers have purchased 120,000 metric tons of soymeal, likely sourced from United States, South America and China, in a series of private deals that closed today. The grain is for arrival in early December.
How do your farm’s crop conditions stack up against other operations in the U.S.? Click this link to take the survey and share updates about your farm’s crop development. Farm Futures grain market analyst Jacqueline Holland regularly reviews and uploads results to the FFTF Google MyMap, so farmers can peer anecdotes from around the country.
When marketing grain, it’s probably wise to stay away from the extremes on either end. But what do those extremes look like, exactly? Ed Usset, marketing specialist at University of Minnesota, paints a picture in his latest Advanced Marketing Class blog – click here for details.
Preliminary volume estimates were for 123,554 contracts, trending 18% above Wednesday’s final count of 104,292.
Wheat
Wheat prices were hit hard by growing global recession fears, expectations for a massive Russian crop this coming season, spillover weakness from other commodities and a strengthening U.S. Dollar. That combination pushed most contracts 4% to 5% lower today. December Chicago SRW futures fell 35.25 cents to $7.9625, December Kansas City HRW futures lost 42 cents to $8.7050, and December MGEX spring wheat futures tumbled 46.5 cents to $8.83.
The Ukrainian Agrarian Council estimates that the country’s 2023 wheat plantings could fall 30% to 40% due to a general lack of funds. That could leave a production of only 551.2 million bushels. Ukraine is typically one of the world’s largest wheat and corn exporters, but that status is obviously in jeopardy amid the ongoing Russian invasion, which has wreaked havoc on both Ukraine’s production potential as well as export logistics.
On the brighter side, the Turkish National Defense Ministry reported today that five more ships have departed Ukrainian ports under a deal brokered between the UN, Russia, Ukraine and Turkey. Since the beginning of August, more than 60 ships carrying more than 1 million metric tons of agricultural exports have sailed from Ukrainian Black Sea ports.
Japan purchased 3.5 million bushels of food-quality wheat from the United States and Canada in a regular tender that closed earlier today. Of the total, 71% was sourced from the U.S. The grain is for arrival by the end of December.
Following direct talks with Russia, Egypt has thought to have purchased another 4.4 million bushels that will be comprised of two to four cargoes that will be shipped in November. Egypt already purchased twice that amount from Russia in a separate deal earlier this week.
South Korea purchased 2.3 million bushels of animal feed wheat, likely sourced from Australia, in a private deal that closed earlier today. The grain is for shipment between early January and early February.
Preliminary volume estimates were for 79,326 CBOT contracts, moving slightly ahead of Wednesday’s final count of 73,676.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Sep
673.75
655
658.25
-15
22-Dec
672.75
654
658
-12
Soybeans
22-Sep
1511.25
1469
1472.75
-35.25
22-Nov
1433
1390
1394.75
-27.75
Soymeal $/ton
22-Oct
429
419.4
422.6
1.7
Soyoil cents/lb
22-Oct
69.34
65.16
65.27
-3.56
Wheat $/bushel
22-Sep
806
773
775.5
-31.75
22-Dec
835
791.25
794.25
-35.25
KC Wheat
22-Sep
928
870
863.5
-54.25
22-Dec
914.75
865
868
-42
MPLS Wheat
22-Sep
915
868
874.5
-41.5
22-Dec
928.75
883
886.5
-46.5
Live Cattle cents/lb
22-Aug
143.725
142.4
142.9
0.325
Feeder Cattle cents/lb
22-Oct
185.55
183.425
184.55
1.075
Lean Hogs cents/lb
22-Dec
84.725
83.05
83.725
-0.15
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Oct
89.63
85.98
86.39
-3.16
Diesel
22-Sep
3.653
3.4433
3.5522
-0.1152
Unleaded Gasoline $/gallon
22-Sep
2.4323
2.3501
2.3768
-0.054
Natural Gas
22-Oct
9.454
9.074
9.31
0.121
U.S. Dollar Index
22-Sep
109.98
108.735
109.605
0.94
Gold $/ounce
22-Oct
1713.1
1689.8
1694
-18.8
Copper
22-Sep
3.518
3.4125
3.4255
-0.093
Fertilizer Swaps
(as of 08/26)
DAP Tampa-index
820.0
-20
DAP-New Orleans
815.7
-11.02
Urea-New Orleans
683.4
66.14
Urea-Middle East
795.0
47.5
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
476.8
22.05
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