Morning report: Corn, soy hang on for early morning gains. (Comments are updated by 7:30 a.m. Central Time.)
Corn up 1-6 cents
Soybeans up 2-6 cents; Soymeal down $5.90/ton; Soyoil down $0.51/lb
Chicago wheat up 29-36 cents; Kansas City wheat up 25-26 cents; Minneapolis wheat up 20-21 cents
*Prices as of 6:55am CDT.
Feedback from the Field updates! How does your farm’s crop conditions stack up against other farms around the country? Click this link to take the survey and share updates about your farm’s crop development. 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!
Corn
The unchanged condition rating in yesterday’s Crop Progress report was not enough to deter corn markets from trading higher this morning, however. Nearby futures prices inched $0.01-$0.06/bushel higher this morning despite the better-than-expected rating released by USDA yesterday.
Gains were limited by a stronger dollar and losses in the energy markets overnight, especially as international markets were more price responsive to global recession concerns during the overnight trading session. Some strength was derived from wheat markets, which are responding to uncertainty surrounding Russia’s agreement to allow safe Ukrainian grain passage through the Black Sea.
Yesterday’s Crop Progress report saw corn condition ratings hold steady at 54% good to excellent for a second straight week through September 4. The reading was slightly better than the trade had been anticipating leading up to the report’s release – analysts had predicted USDA would grade corn conditions between 52%-53%, with an average guess of 53% good to excellent.
The crop is quickly maturing despite its late start to the season. Both doughing and denting progress are now aligned with five-year averages at 92% and 63% complete, respectively, as of September 4. Maturation rates stood at 15% complete as of Sunday, up 7% from the previous week but also in line with the five-year historical benchmark average.
Corn crops in the South continue to lead the charge towards peak harvest season. Maturation rates in the top corn-producing states further north are still lagging behind historical standards, but hot and dry weather this week will likely accelerate crop development by the time next week’s Crop Progress report rolls around.
Soybeans
Soybean prices moved $0.02-$0.06/bushel higher overnight on some bargain buying, despite some supply and demand headwinds. China its reported August 2022 soybean import paces (263 million bushels) as being 25% lower than the same time last year as high prices eroded domestic demand for the oilseed.
That should not have come as a surprise, as Chinese soybean import paces have been slow in recent months. “Imports have been very sluggish for the past three months,” Darin Friedrichs, co-founder of Shanghai-based consultancy Sitonia Consulting, told Reuters.
Chinese livestock production was down 7% on the year in July 2022, which also helped limit demand. Soybean crush margins have traded in the red since mid-April, offering little incentive to expand soy production in China currently.
The bargain buying after yesterday’s three-week low was limited amid better-than-expected soybean ratings, ongoing energy market losses, a stronger dollar, and continued fears about a global economic contraction.
For a third straight week, USDA has held soybean condition ratings constant at 57% good to excellent, according to yesterday’s Crop Progress report. Once again this week, pre-report analyst estimates had expected a slight downgrade to soybean conditions (pre-report range: 55%-57% with an average guess of 56%), which left the soy futures complex wavering between gains and losses in this morning’s trading session.
Pod filling is largely completed around the U.S., with much of the crop avoiding what had been forecast to be a blistering August. Timely rains also helped keep yield hopes alive for growers around the country. As of Sunday, 94% of the crop had set pods, up 3% from the previous week and just 2% behind the five-year average.
Market focus will now turn to final maturation and eventually harvest progress for the soybean crop. Through last Sunday, 10% of the crop had begun dropping leaves. While that figure was a 6% increase from the previous week’s reading, it remains 4% below the five-year average after a slow start to the 2022 growing season earlier this spring.
Wheat
Wheat prices soared $0.20-$0.36/bushel higher overnight despite a stronger dollar. Global markets are increasingly wary of Russia’s willingness to allow safe passage of Ukrainian grain supplies through Black Sea corridors.
Overnight, Russian president Vladimir Putin called for fewer countries to be allowed to receive shipments of Ukrainian grain, calling the ongoing “Grain Initiative” that guarantees Ukrainian grain cargoes safe passage from occupying Russian naval forces in the Black Sea “not fair.”
Putin spoke at an economic forum in Eastern Russia on the matter, criticizing the agreement for not prioritizing grain shipments to nations at highest risk of hunger. Markets are worried this morning that Putin may prematurely end the “Grain Initiative,” which would tie up much of Ukraine’s newly harvested wheat crops.
It’s worth noting – many of the shipments going out of Ukraine’s Black Sea ports are fulfilling previously agreed-upon contracts. Remember, the ports were down for six months, which created a significant backlog and not all ports are yet running at full capacity (cough, Odessa, cough).
There are some grain shipments that have departed to drought-stressed regions of Africa and the Middle East, despite Putin’s insistence otherwise. Even though the volumes may not be meeting Putin’s standards, it is an interesting battle Putin is picking here.
Putin’s own growers are resisting booking further sales as a strong ruble limits profit opportunities for them. Russia’s wheat exports are 22% lower than a year ago amid Ukrainian port reopening’s and greater international resistance towards dealing with Russian state-owned grain operators, especially as sanctions increase freight and insurance costs for Russian grain cargoes.
It’s winter wheat planting season! USDA shared its first glimpse at 2023 planting progress in yesterday’s Crop Progress report, finding that through the week ending September 4, 3% of anticipated 2023 winter wheat acreage had been planted.
The latest results from our farmer-sourced August 2022 Farm Futures survey finds that winter wheat acreage is likely to expand in the Eastern Corn Belt this year. Check out our 2023 Acreage Projections if you’re curious to learn more!
Yesterday’s figure was in line with the five-year historical benchmark for the same reporting period, though it registered 2% lower than year-ago paces. However, a slow start to the spring growing cycle due to cold soil temperatures and excessive wetness are also likely to keep this year’s winter wheat planting paces slightly behind last year’s rates.
USDA dropped spring wheat condition ratings from its weekly Crop Progress report this week with over two-thirds of the crop harvested across the Northern U.S. border. Through the week ending Sunday, 71% of the crop had been harvested, up a staggering 21% from last week thanks to warm and dry weather in the Northern U.S. last week.
Harvest paces this year continue to lag behind the five-year average due planting delays this spring. Also, last year’s drought in the Northern Plains accelerated planting speeds relative to historical benchmarks – this time last year, 94% of the spring wheat crop had been harvested. But the latest crop readings suggest that the spring wheat crop is in largely good condition, so the delays are not likely to be a significant factor to harvest losses over the next couple weeks.
Plus, Mother Nature is finally giving spring wheat growers a break. Clear skies this week should pave the way for fast harvest speeds this week, which should help the harvest season wrap up in the next couple of weeks.
Weather
It’s going to be another blistering day on the Plains, according to NOAA’s short-range forecasts. My car thermometer topped out at 100 yesterday and I am so ready for fall weather to hit the Colorado Front Range. My lawn is too – we finished seeding it on Monday and are ready to let the fall growing season commence! We have some good emergence already and the parts that I flashed with Tenacity a couple weeks ago are starting to turn back to green.
But I digress. Temperatures will likely reach the high 90s to 100-degree mark again today in the Plains, while the Great Lakes region and Eastern Corn Belt have better chances of enjoying highs in the mid-80s to low 90s today.
Mostly clear skies are expected across the country today, though parts of the East Coast could see a slight chance of showers as a low-pressure system moves in.
The 6-10-day NOAA outlook is forecasting above average chances for excessive heat for most of the country, except the lower half of the Mississippi River Valley and most of the Southeast, over the next 10 days. The mid-portion of the country will remain dry during that time, while both coasts could see above average chances for rain.
Above average heat will continue to persist across nearly all of the country except the West Coast in the 8-14 day NOAA outlook, Dry weather will continue to plague the Central Plains and Eastern Corn Belt during that time, though spring wheat growers in the Pacific Northwest with late planted crops could face an above average chance for showers as the end of September creeps up.
Financials
Despite overnight losses at European stock exchanges, S&P 500 futures inched up 0.07% this morning to $3,913.25. This morning’s gains were a mystery to Wall Street analysts, likely reflecting some bargain buying at play after recent losses.
“Give me a reason why markets should be going up,” BNP Paribas Asset Management strategist Daniel Morris replied when the Wall Street Journal asked why markets were down this morning.
Globally, investors still remain wary of a recession, which pushed the dollar higher overnight.
Another round of COVID-19 lockdowns are underway in China, which increases concern about global economic contraction – and continued global supply chain issues. High natural gas costs in the European Union continues to thwart manufacturing production and increase energy costs.
What else I’m reading this morning on our website, FarmFutures.com:
Bryce Knorr points out that corn shows better odds for rallies over the coming month.
What are you doing with your bushels this fall? Advance Trading’s Luke Williams poses that question to readers to help direct fall marketing decisions.
Farm finances are showing glimmers of hope, according to the Purdue Ag Economy Barometer. But rising input costs and interest rate still represent challenges for farmers.
Farm Futures’ 2023 Acreage Projections are live on our website. Spoiler alert: corn and winter wheat are poised to reign supreme next year.
Another day, another supply chain issue, writes executive editor Mike Wilson. Farmers who want to upgrade equipment may need to pay now – and wait.
Morning Ag Commodity Prices – 9/7/2022
Contract
Units
High
Low
Last
Net Change
% Change
SEP ’22 CORN
$ / BSH
6.85
6.7525
6.85
0.0425
0.62%
DEC ’22 CORN
$ / BSH
6.84
6.69
6.8225
0.0625
0.92%
MAR ’23 CORN
$ / BSH
6.8925
6.75
6.875
0.0575
0.84%
MAY ’23 CORN
$ / BSH
6.9
6.765
6.885
0.0575
0.84%
JUL ’23 CORN
$ / BSH
6.85
6.715
6.8325
0.05
0.74%
SEP ’23 CORN
$ / BSH
6.4125
6.3025
6.39
0.0225
0.35%
DEC ’23 CORN
$ / BSH
6.265
6.17
6.235
0.0025
0.04%
AR2 ’24 CORN
$ / BSH
6.3325
6.245
6.32
0.015
0.24%
MAY ’24 CORN
$ / BSH
0
#N/A
6.33
0
0.00%
SEP ’22 SOYBEANS
$ / BSH
14.8525
14.8525
14.8525
-0.0475
-0.32%
NOV ’22 SOYBEANS
$ / BSH
14.0475
13.84
14.01
0.0225
0.16%
JAN ’23 SOYBEANS
$ / BSH
14.1
13.895
14.065
0.0275
0.20%
MAR ’23 SOYBEANS
$ / BSH
14.1275
13.9275
14.09
0.0225
0.16%
MAY ’23 SOYBEANS
$ / BSH
14.1425
13.94
14.105
0.02
0.14%
JUL ’23 SOYBEANS
$ / BSH
14.1
13.92
14.0775
0.0175
0.12%
AUG ’23 SOYBEANS
$ / BSH
13.9475
13.7525
13.9475
0.0525
0.38%
SEP ’23 SOYBEANS
$ / BSH
13.555
#N/A
13.515
0
0.00%
NOV ’23 SOYBEANS
$ / BSH
13.4
13.24
13.38
0.02
0.15%
AN2 ’24 SOYBEANS
$ / BSH
0
#N/A
13.39
0
0.00%
AR2 ’24 SOYBEANS
$ / BSH
0
#N/A
13.3275
0
0.00%
SEP ’22 SOYBEAN OIL
$ / LB
66.6
#N/A
68.96
0
0.00%
OCT ’22 SOYBEAN OIL
$ / LB
64.9
63.51
64.36
-0.54
-0.83%
SEP ’22 SOY MEAL
$ / TON
437.9
437.9
437.9
4.4
1.01%
OCT ’22 SOY MEAL
$ / TON
417.4
407.9
416.8
6.2
1.51%
DEC ’22 SOY MEAL
$ / TON
412.9
404.4
412.3
5.5
1.35%
JAN ’23 SOY MEAL
$ / TON
410.2
402.3
409.8
5.2
1.29%
MAR ’23 SOY MEAL
$ / TON
404.4
397
404.2
5.1
1.28%
SEP ’22 Chicago SRW
$ / BSH
8.36
8.0225
8.36
0.36
4.50%
DEC ’22 Chicago SRW
$ / BSH
8.5375
8.0925
8.475
0.305
3.73%
MAR ’23 Chicago SRW
$ / BSH
8.66
8.2425
8.61
0.29
3.49%
MAY ’23 Chicago SRW
$ / BSH
8.7175
8.3375
8.675
0.265
3.15%
JUL ’23 Chicago SRW
$ / BSH
8.69
8.3375
8.65
0.24
2.85%
SEP ’23 Chicago SRW
$ / BSH
8.735
8.4125
8.695
0.225
2.66%
DEC ’23 Chicago SRW
$ / BSH
8.8325
8.5
8.81
0.24
2.80%
SEP ’22 Kansas City HRW
$ / BSH
8.71
#N/A
8.79
0
0.00%
DEC ’22 Kansas City HRW
$ / BSH
9.145
8.74
9.0875
0.2675
3.03%
MAR ’23 Kansas City HRW
$ / BSH
9.15
8.755
9.105
0.2675
3.03%
MAY ’23 Kansas City HRW
$ / BSH
9.1425
9.0175
9.1375
0.2975
3.37%
JUL ’23 Kansas City HRW
$ / BSH
9.05
8.725
9.025
0.2675
3.05%
SEP ’23 Kansas City HRW
$ / BSH
9
8.8925
9
0.255
2.92%
DEC ’23 Kansas City HRW
$ / BSH
9.04
9.04
9.04
0.2325
2.64%
SEP ’22 MLPS Spring Wheat
$ / BSH
0
#N/A
8.71
0
0.00%
DEC ’22 MLPS Spring Wheat
$ / BSH
9.16
8.8
9.095
0.1975
2.22%
MAR ’23 MLPS Spring Wheat
$ / BSH
9.275
8.93
9.2175
0.2
2.22%
MAY ’23 MLPS Spring Wheat
$ / BSH
9.35
9.09
9.2825
0.1875
2.06%
JUL ’23 MLPS Spring Wheat
$ / BSH
9.335
9.0375
9.335
0.235
2.58%
SEP ’23 MLPS Spring Wheat
$ / BSH
9.06
8.87
9.06
0.2275
2.58%
DEC ’23 MLPS Spring Wheat
$ / BSH
9.0275
9
9.0275
0.195
2.21%
SEP ’21 ICE Dollar Index
$
110.775
110.16
110.635
0.431
0.39%
OC ’21 Light Crude
$ / BBL
87.76
85.08
86.7
-0.18
-0.21%
NO ’21 Light Crude
$ / BBL
87.33
84.73
86.31
-0.2
-0.23%
OCT ’22 ULS Diesel
$ /U GAL
3.6066
3.5222
3.5834
0.0096
0.27%
NOV ’22 ULS Diesel
$ /U GAL
3.5379
3.4592
3.5156
0.0054
0.15%
OCT ’22 Gasoline
$ /U GAL
2.4672
2.3819
2.445
0.0291
1.20%
NOV ’22 Gasoline
$ /U GAL
2.4171
2.3345
2.3914
0.0234
0.99%
SEP ’22 Feeder Cattle
$ / CWT
0
#N/A
184.175
0
0.00%
OCT ’22 Feeder Cattle
$ / CWT
0
#N/A
186.1
0
0.00%
CT2 ’21 Live Cattle
$ / CWT
0
#N/A
145.05
0
0.00%
DE ’21 Live Cattle
$ / CWT
0
#N/A
150.875
0
0.00%
OCT ’22 Live Hogs
$ / CWT
0
#N/A
91.1
0
0.00%
DEC ’22 Live Hogs
$ / CWT
0
#N/A
83.5
0
0.00%
SEP ’22 Class III Milk
$ / CWT
19.63
19.61
19.61
-0.06
-0.31%
OCT ’22 Class III Milk
$ / CWT
20.01
20.01
20.01
-0.08
-0.40%
NOV ’22 Class III Milk
$ / CWT
20.55
#N/A
20.7
0
0.00%
