Concerns over a generally slow export pace so far this marketing year was enough to push grain prices back into the red following a round of technical selling on Wednesday. Wheat prices suffered the most blowback, with some contracts falling more than 3.5% lower today. Corn prices also faced a significant technical setback with cuts of more than 2.25%. Soybean prices were relatively spared, drifting 0.5% lower by the close.
A scattering of light rain and/or snow will be possible for parts of the Midwest between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s new 8-to-14-day outlook calls for a return to seasonally wet weather for the Plains and western Corn Belt between January 11 and January 17, with widespread warmer-than-normal conditions likely for the centra U.S. next week.
On Wall St., the Dow eased 43 points lower in afternoon trading to 33,092. Investors are still skittish over the prospect of the Federal Reserve continuing to issue interest rate hikes in 2023. Energy futures were sharply lower, with crude oil down another 4.5% this afternoon to $73 per barrel on rising domestic stocks and lingering concerns about global demand. Diesel dropped 3.5%, with gasoline down more than 4%. The U.S. Dollar softened moderately.
On Tuesday, commodity funds were net sellers of all major grain contracts, including corn (-6,500), soybeans (-9,000), soymeal (-3,000), soyoil (-3,000) and CBOT wheat (-5,000).
Corn
Corn prices followed a broad range of other commodities lower and incurred double-digit losses on Wednesday as demand concerns regained some focus today. May futures lost 15.75 cents to $6.5475, with May futures down 15.25 cents to $6.55.
Corn basis bids were steady to mixed on Wednesday after rising as much as 5 cents higher at an Indiana ethanol plant and falling as much as 5 cents lower at an Iowa river terminal today.
USDA reported yesterday that 447.4 million bushels of corn were used to produce ethanol in November, which is down from year-ago totals of 466.9 million bushels. Another 1.778 million metric tons of DDGS were also produced in November.
Brazil’s Anec estimates that the country’s corn exports in January will reach 169.3 million bushels. Anec also reported that the country’s total 2022 corn exports had more than doubled the prior year’s tally, with just under 1.7 billion bushels.
Whether or not you attended the Farm Progress Show and/or Husker Harvest Days this summer, you should still make plans to attend the 2023 Farm Futures Business Summit, coming up later this month. It’s packed with expert presentations, farmer panels, opportunities for one-of-a-kind peer networking and more. Click here to catch a glimpse of what’s in store and learn how to register.
We try not to play favorites at Farm Futures, but we also felt that a handful of stories we wrote last year warranted a bit of extra attention. Click here to read the staff favorites of 2022.
Preliminary volume estimates were for 282,057 contracts, moving moderately ahead of Tuesday’s final count of 242,377.
Soybeans
Soybean prices saw moderate declines after spillover weakness from other commodities spurred some technical selling on Wednesday. January futures dropped 7.75 cents to $14.7950, with March futures down 7.5 cents to $14.8475.
Soybean basis bids were mostly steady across the central U.S. on Wednesday but did trend as much as 10 cents higher at a Nebraska processor and as much as 2 cents lower at an Iowa river terminal today.
Private exporters announced to USDA the sale of 4.6 million bushels of soybeans for delivery to unknown destinations during the 2022/23 marketing year, which began September 1.
Brazil’s Anec reported that the country’s total soybean exports in 2022 reached 2.859 billion bushels. That was a year-over-year decrease of around 10%. Brazilian soymeal exports trended moderately higher last year, with 20.4 million metric tons.
A record amount of farm wealth may transfer hands over the next 10 to 15 years, according to Mike Downey, co-owner of Next Gen Ag Advocates. “Are we as an industry ready for this?” he inquires. “Are you and your estate planning in order?” Downey serves up a few suggestions to add to your estate plan checkup list in his latest More than Dirt column – click here to learn more.
South Korea purchased around 220,000 bushels of GMO-free soybeans in an international tender that closed earlier today. The grain is for arrival between December 2023 and June 2024.
Argentina has faced plenty of overly dry conditions in recent months, but there are even bigger problems at hand, according to Cesar Cruz, director of research with Advance Trading. “Double-digit inflation rates in the country have afflicted the Argentine population for 10 straight years now,” he notes. “High inflation is not the only economic problem in Argentina. The monetary policy interest rate is set at 75% per year and has constantly faced upward pressure due to increasing prices (the effective annual rate is 107.35%). With higher interest rates, future investments in real assets may be limited, resulting in lower economic growth and a higher unemployment rate.” Cruz takes a closer look at the situation in today’s Ag Marketing IQ blog – click here to learn more.
Preliminary volume estimates were for 138,184 contracts, tracking moderately below Tuesday’s final count of 191,215.
Wheat
Wheat prices were slashed significantly as fresh demand concerns and spillover weakness from waning energy prices triggered an ample round of technical selling on Wednesday. March Chicago SRW futures lost 29.5 cents to $7.46, March Kansas City HRW futures fell 28.25 cents to $8.41, and March MGEX spring wheat futures dropped 15.75 cents to $9.0350.
Russian consultancy Sovecon estimates that the country’s wheat exports in December reached 150.6 million bushels. That would be slightly below November’s total of 158.0 million bushels, if realized. Russia is the world’s No. 1 wheat exporter.
Thailand purchased 2.8 million bushels of animal feed wheat from optional origins in an international tender that closed earlier today. The grain is for shipment in April.
Tunisia issued an international tender to purchase 3.7 million bushels of soft milling wheat and 3.4 million bushels of animal feed barley from optional origins that closes on Thursday. The grain is for shipment starting later this month.
The Philippines issued an international tender to purchase 4.0 million bushels of animal feed wheat that closes on Thursday. The grain is for shipment in February and March.
Preliminary volume estimates were for 76,422 CBOT contracts, which was slightly better than Tuesday’s final count of 74,048.
| Settlement Prices for Key Commodities | ||||
| High | Low | Last | Change | |
| Corn $/bushel | ||||
| 23-Mar | 671.75 | 652.5 | 653.75 | -15.75 |
| 23-May | 671 | 653.25 | 654 | -15.75 |
| Soybeans | ||||
| 23-Jan | 1496.25 | 1477.25 | 1478.25 | -7.75 |
| 23-Mar | 1506.5 | 1480.75 | 1483.5 | -7.5 |
| Soymeal $/ton | ||||
| 23-Mar | 472.6 | 459.6 | 462.7 | -1.6 |
| Soyoil cents/lb | ||||
| 23-Mar | 63.75 | 62.5 | 62.85 | -0.37 |
| Wheat $/bushel | ||||
| 23-Mar | 780.5 | 744.25 | 745.5 | -29.5 |
| 23-May | 787.5 | 752.75 | 753.75 | -29 |
| KC Wheat | ||||
| 23-Mar | 872.25 | 836.5 | 840.75 | -28.25 |
| 23-May | 865.25 | 832.75 | 836.5 | -28.25 |
| MPLS Wheat | ||||
| 23-Mar | 920.75 | 901.75 | 903.5 | -15.75 |
| 23-May | 910.5 | 893.75 | 894.75 | -15.25 |
| Live Cattle cents/lb | ||||
| 23-Feb | 157.85 | 156.925 | 157.275 | 0.425 |
| Feeder Cattle cents/lb | ||||
| 23-Mar | 188.75 | 184.875 | 188.15 | 3.375 |
| Lean Hogs cents/lb | ||||
| 23-Apr | 95.025 | 92.5 | 92.525 | -1.275 |
| Crude Oil $/barrel | *Energy prices may not represent final settlements | |||
| 23-Feb | 77.42 | 72.73 | 73.06 | -3.87 |
| Diesel | ||||
| 23-Feb | 3.0912 | 2.9215 | 2.9805 | -0.106 |
| Unleaded Gasoline $/gallon | ||||
| 23-Feb | 2.3754 | 2.2433 | 2.2635 | -0.0977 |
| Natural Gas | ||||
| 23-Mar | 3.81 | 3.595 | 3.76 | 0.119 |
| U.S. Dollar Index | ||||
| 23-Mar | 104.385 | 103.595 | 104.045 | -0.267 |
| Gold $/ounce | ||||
| 23-Feb | 1871.3 | 1842 | 1855.1 | 15.4 |
| Copper | ||||
| 23-Jan | 3.752 | 3.7275 | 3.741 | -0.025 |
| Fertilizer Swaps | (as of 12/30) | |||
| DAP Tampa-index | 645.0 | -47 | ||
| DAP-New Orleans | 680.7 | -24.8 | ||
| Urea-New Orleans | 502.1 | -13.78 | ||
| Urea-Middle East | 548.0 | -14.5 | ||
| Urea-Black Sea | 585.0 | 35 | ||
| UAN (32%) New Orleans | 512.6 | -77.16 | ||
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