Soybeans capture double-digit gains.
Corn and wheat suffer substantial cuts to start the week, in contrast
Grain prices finished Monday’s session with mixed but mostly lower results. Soybeans continued to climb higher and are closing in on $15 per bushel after a new flash sale to China and additional reports that question Brazil’s production potential triggered another round of technical buying. Corn prices failed to follow suit, falling more than 1.5% today. Wheat prices suffered even bigger cuts, with some contracts losing more than 3%.
Groundhog Day arrives on Wednesday, but Winter Storm Landon is also arriving later this week and could dump a foot or more of snow in a band stretching from southeastern Kansas all the way through the Northeast. Next week, NOAA’s 8-to-14-day outlook predicts a return to seasonally dry weather in the Corn Belt between February 7 and February 13, with warmer-than-normal weather likely for the Northern and Central Plains during this time.
On Wall St., the Dow improved 274 points to reach 35,000, with bargain buying for tech stocks leading the charge today after a selloff earlier this month. Energy futures were mixed but mostly higher. Crude oil firmed more than 1.25% to close in on $88 per barrel. Gasoline was also up 0.5%, while nearby diesel contracts trended 0.75% lower. The U.S. Dollar softened moderately.
Last Friday, commodity funds were net buyers of all major grain contracts, including corn (+19,000), soybeans (+12,500), soymeal (+4,000), soyoil (+6,000) and CBOT wheat (+5,500).
Corn
Corn prices came into Monday’s session with modest overnight gains but quickly spilled into the red on a round of technical selling partly spurred by spillover weakness from wheat. March futures fell 11.25 cents to $6.2475, while May futures dropped 9.75 cents to $6.2350.
Corn basis bids were steady to weak after tilting 2 to 7 cents lower across four Midwestern locations on Monday.
Corn export inspections fell to 40.8 million bushels for the week ending January 27. That was also on the lower end of trade guesses, which ranged between 37.4 million and 55.1 million bushels. Mexico was the No. 1destination, with 13.5 million bushels. Cumulative totals for the 2021/22 marketing year remain moderately below last year’s pace, with 690.7 million bushels.
USDA announced plans to open a 25-acre “pop-up” site at the Port of Oakland with the intention of filling empty shipping containers with ag commodities, using funds from the Commodity Credit Corporation. “We look forward to engaging with other ports on similar solutions to congestion,” according to U.S. Transportation Secretary Pete Buttigieg. Farm Futures policy editor Jacqui Fatka offers additional reporting on the issue here.
Preliminary volume estimates were for 447,850 contracts, firming 30% above Friday’s final count of 343,197.
Soybeans
Soybean prices benefited from another round of technical buying Monday on the heels of another large sale to China, along with two more consultancies predicting that Brazil’s production potential has fallen below 5 billion bushels. Prices have been rapidly closing in on $15 per bushel, a benchmark not seen since last June. Today, March futures improved 20.75 cents to $14.9075, with May futures up 20.25 cents to $14.9550.
Soybean basis bids were mostly steady but did show some big volatility at a few locations on Monday after sinking 9 cents lower at an Ohio elevator and jumping 35 cents higher at an Iowa processor today.
Private exporters announced to USDA the sale of 4.7 million bushels of soybeans to China. Just over half of the total is for delivery during the current marketing year, which began September 1, with the remaining 49% for delivery in 2022/23.
Soybean export inspections moved modestly higher week-over-week to 51.9 million bushels. That was also toward the higher end of trade estimates, which ranged between 29.4 million and 53.3 million bushels. China accounted for just over half of the total, with 26.8 million bushels. Cumulative totals for the 2021/22 marketing year are still well behind last year’s pace, with 1.333 billion bushels.
Two more Brazilian consultancies have lowered their expectations for the country’s soybean production potential this season. AgRural’s latest estimate has dropped to 4.722 billion bushels, while AgResource’s new estimate has tumbled to 4.593 billion bushels. Both consultancies cited widespread drought in some key southern production areas as the reason for these declines.
Iran issued a new tender to purchase 60,000 metric tons of soymeal from optional origins that closes on Wednesday. The grain is for shipment starting in February. Iran is expected to be an active grain buyer this year after coming off the worst drought-stressed season in 50 years.
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Preliminary volume estimates were for 201,237 contracts, falling 32% below Friday’s final count of 297,906.
Wheat
Wheat prices faded substantially lower as geopolitical concerns between Ukraine and Russia appear to be cooling for now. That led to a round of technical selling that pushed most prices down 1.5% to 3%. March Chicago SRW futures lost 25.25 cents to $7.61, March Kansas City HRW futures fell 23.5 cents to $7.7875, and March MGEX spring wheat futures dropped 14 cents to $9.0625.
Wheat export inspections saw moderate week-over-week reductions, dropping to 13.3 million bushels. That was also slightly on the lower end of trade estimates, which ranged between 11.0 million and 18.4 million bushels. Japan was the No. 1 destination, with 4.4 million bushels. Cumulative totals for the 2021/22 marketing year are still trending moderately below last year’s pace, with 499.4 million bushels.
Russian consultancy Sovecon estimates that the country’s wheat exports will reach 88.2 million bushels in January. That would be a month-over-month decline of 31% and the lowest monthly tally since last July, if realized. Russia is the world’s No. 1 wheat exporter, and Sovecon is currently estimating sales will total 1.260 billion bushels in the current marketing year.
Preliminary volume estimates were for 105,840 CBOT contracts, trending moderately above Friday’s final count of 74,699.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Mar
642.5
622.5
626
-11.25
22-May
640.5
622.25
624.5
-9.75
Soybeans
22-Mar
1496.75
1473.5
1490.5
20.75
22-May
1501.5
1479
1495.25
20.25
Soymeal $/ton
22-May
418.6
410.8
417
6.6
Soyoil cents/lb
22-May
66.67
64.42
64.81
-0.34
Wheat $/bushel
22-Mar
798.5
756.75
761.25
-25.25
22-May
803.5
762.25
766.25
-24.75
KC Wheat
22-Mar
817
777
781.25
-23.5
22-May
820
780.75
784.25
-23.5
MPLS Wheat
22-Mar
934.75
895.5
906.5
-14
22-May
930.5
892.75
902.75
-15.25
Live Cattle cents/lb
22-Feb
140.05
138.85
139.45
0.75
Feeder Cattle cents/lb
22-Apr
168.675
165.4
168.675
3.375
Lean Hogs cents/lb
22-Apr
96.3
94.725
95.5
0.575
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Mar
88.25
86.34
88.05
1.23
Diesel
22-Feb
2.816
2.7457
2.7599
-0.0256
Unleaded Gasoline $/gallon
22-Feb
2.5741
2.5388
2.5596
0.0173
Natural Gas
22-Apr
4.803
4.533
4.691
0.218
U.S. Dollar Index
22-Mar
97.3
96.51
96.545
-0.721
Gold $/ounce
22-Mar
1799.9
1785.7
1797.7
12.8
Copper
22-Feb
4.3285
4.2785
4.3285
0.0255
Fertilizer Swaps
(as of 01/28)
DAP Tampa-index
810.0
0
DAP-New Orleans
738.6
-28
Urea-New Orleans
598.0
-41
Urea-Middle East
655.0
-68
Urea-Black Sea
667.5
-38
UAN (32%) New Orleans
606.3
0
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