Corn, soybeans and wheat continue to move higher in Wednesday’s session
Grain prices captured big gains yesterday and were back for an encore today, with traders still focused on some bullish news that includes dry South American weather forecasts and solid export demand. Corn prices rose 0.75%, with soybeans grabbing double-digit gains and moving more than 1.5% higher. Winter wheat prices also found solid gains ranging from 1.3% to 1.9%, while spring wheat prices were relatively flat.
Some more rain and snow will develop across the Northern Plains and upper Midwest between Thursday and Sunday, while areas farther south will see no measurable moisture during that time, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts seasonally cold weather spreading across the Plains and western Corn Belt between December 29 and January 4, with wetter-than-normal conditions likely for most of the country next week.
On Wall St., the Dow moved higher for a second straight session, gaining 179 points in afternoon trading to 35,672 after the FDA authorized emergency use authorization for the covid pill that Pfizer has developed. As with grain markets, trading activity is beginning to wane as Christmas approaches. Energy prices made solid inroads, with crude oil rising almost 2.5% this afternoon to move closer to $73 per barrel. Diesel gained 2.25%, while gasoline firmed around 1% higher. The U.S. Dollar softened moderately.
Yesterday, commodity funds were significant net buyers of all major grain contracts, including corn (+9,000, soybeans (+9,500), soymeal (+4,500), soyoil (+3,500) and CBOT wheat (+12,000).
Corn
Corn prices followed other grains higher on a round of technical buying that lifted prices for a second straight session and allowing them to close above $6 per bushel for the first time since July. March futures added 4.25 cents to $6.0250, with may futures up 4.75 cents to $6.04.
Corn basis bids were steady to weak after falling 2 to 6 cents lower at four separate Midwestern facilities on Wednesday.
Weekly ethanol production tilted moderately lower, sliding to a daily average of 1.051 million barrels, per the latest round of data from the U.S. Energy Information Administration out earlier today. That marks the 11th straight week that daily production has topped 1 million barrels. Ethanol stocks tracked lower for the first time in five weeks.
Ahead of USDA’s next export report, out tomorrow morning and covering the week through December 16, analysts expect the agency to show corn sales ranging between 28.5 million and 57.1 million bushels.
Ukraine has exported 354.3 million bushels of corn so far during the 2021/22 marketing year and could 1.216 billion bushels by the end of the season, according to the country’s agriculture ministry. Ukraine is coming off a record-breaking harvest this fall, and total grain exports have trended nearly 22% higher so far in 2021/22.
Interested in learning more about the relative strength index? The RSI is a mathematical evaluation of a commodity’s price action in the short, medium and long term. Grain marketing consultant Roger Wright explores how the RSI can signal if a particular commodity is overbought or oversold and therefore due for a correction - click here for additional insights from today’s Ag Marketing IQ blog.
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Preliminary volume estimates were for 239,115 contracts, moving moderately above Tuesday’s final count of 169,912.
Soybeans
Soybean prices climbed more than 1.5% higher Wednesday, with traders still focused on dry South American weather and expecting a decent round of export sales data from USDA tomorrow morning. January futures rose 20.25 cents to $13.2825, with March futures up 22 cents to $13.3475.
Soybean basis bids trended 3 to 5 cents lower at two Midwestern locations on Wednesday while holding steady elsewhere across the central U.S.
Ahead of Thursday morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 27.6 million and 72.8 million bushels for the week ending December 16. Analysts also expect to see soymeal sales ranging between 50,000 and 280,000 metric tons, plus another 50,000 MT to 85,000 MT of soyoil sales.
Through November 17, the U.S. Environmental Protection Agency collected reports of 3,461 incidents and more than 1 million acres of soybeans affected by off-target dicamba damage. “Will EPA make changes to dicamba’s registration and application requirements? This report gathers the intel on what that could mean for farmers and the industry,” according to Farm Futures policy editor Jacqui Fatka, who takes a deeper dive into the ongoing situation here.
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Preliminary volume estimates were for 217,188 contracts, inching slightly below Tuesday’s final count of 218,625.
Wheat
Wheat prices rose on strong global demand, coupled with the prospect that Ukraine may decide to limit sales over the first half of 2022. Spillover strength from other commodities lent additional support today. March Chicago SRW futures rose 14.5 cents to $8.1350 and March Kansas City HRW futures gained 12 cents to $8.5350. MGEX spring wheat sales were mostly flat, bucking the overall trend. March futures eased 0.25 cents lower, to $10.2525.
Ahead of tomorrow morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 7.3 million and 21.1 million bushels for the week ending December 16.
In Ukraine, farmers have already exported 573.2 million bushels of wheat and could see sales reach 900.2 million bushels by the end of the 2021/22 marketing year, per data from its agriculture ministry. Ukraine is one of the world’s top exporters of both wheat and corn.
Germany, which is Europe’s No. 2 wheat producer, saw plantings inch 0.4% higher for the 2021/22 crop, for a footprint of around 7.092 million acres. German canola acres rose nearly 9% higher this season.
Preliminary volume estimates were for 75,516 CBOT contracts, which was a slight decline compared to Tuesday’s final count of 79,597.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Mar
606.75
597
602.5
4.25
22-May
607.5
598
604
4.75
Soybeans
22-Jan
1333.25
1304.75
1328.75
20.25
22-Mar
1339
1309.5
1335
22
Soymeal $/ton
22-Mar
399.8
388.7
398.3
7.8
Soyoil cents/lb
22-Mar
55.07
53.94
54.84
0.85
Wheat $/bushel
22-Mar
817
792
814
14.5
22-May
820.25
795
817.75
15.75
KC Wheat
22-Mar
856.5
830.25
853.75
12
22-May
854.75
829.25
852.25
11.25
MPLS Wheat
22-Mar
1033
1019.25
1027.75
-0.25
22-May
1023.75
1010.25
1020.25
2
Live Cattle cents/lb
21-Dec
136.05
135.3
135.55
0.025
Feeder Cattle cents/lb
22-Mar
162.25
160.45
161.675
-0.15
Lean Hogs cents/lb
22-Apr
86.95
85.525
86.6
1.025
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Jan
73.03
70.8
72.95
1.83
Diesel
22-Jan
2.3133
2.2464
2.311
0.0532
Unleaded Gasoline $/gallon
22-Jan
2.1758
2.1341
2.1754
0.0232
Natural Gas
22-Feb
3.93
3.73
3.84
0.066
U.S. Dollar Index
22-Mar
96.585
96.015
96.075
-0.414
Gold $/ounce
22-Jan
1803.2
1785.9
1803.4
15.5
Copper
21-Dec
4.373
4.345
4.371
0.033
Fertilizer Swaps
(as of 12/17)
DAP Tampa-index
810.0
0
DAP-New Orleans
821.2
1
Urea-New Orleans
857.1
13
Urea-Middle East
945.0
0
Urea-Black Sea
902.5
-8
UAN (32%) New Orleans
606.3
-19.29
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