Grain prices are sometimes quiet in the week between Christmas and New Year’s, but thanks to a series of bullish factors, they jumped substantially higher on Wednesday. Soybeans led the charge, rising more than 1.75% in the ensuing round of technical buying. Corn prices closed with gains of around 1.25%. Wheat showed some variability, moving between 0.1% and 1.5% higher today.
Between Thursday and Sunday, plenty of additional rain and snow will be building in a band stretching from the Mid-South into the eastern Corn Belt and Great Lakes region, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts more seasonally wet weather in store for the central U.S. between January 4 and January 10, with warmer-than-normal conditions probable for the eastern half of the country during this time.
On Wall St., stocks suffered a moderate setback, with the Dow falling 212 points in afternoon trading to 33,028 as investors look to put a period on a losing 2022 and scrape together some optimism for 2023. Energy futures also trended lower, with crude oil down 1.25% to $78 per barrel this afternoon. Diesel and gasoline also suffered moderate technical setbacks on Wednesday. The U.S. Dollar firmed moderately.
On Tuesday, commodity funds were net buyers of corn (+6,000), soybeans (+1,500), soyoil (+6,500) and CBOT wheat (+500) contracts but were net sellers of soymeal (-1,000).
Corn
Corn prices trended 1.25% higher after rising steady throughout Wednesday’s session, primarily on spillover support from soybeans and dry forecasts for South America. March futures gained 8.25 cents to $6.83, with May futures up 8.75 cents to $6.82.
Corn basis bids were mostly steady to weak across the central U.S. on Wednesday after sliding 5 to 7 cents lower at three Midwestern locations. An Illinois river terminal bucked the overall trend after tracking 2 cents higher today.
A weather market has begun to unfold in South America, and it’s time to take a closer look at what’s going on there, according to Josh Green with Advance Trading. “The unpredictable nature of weather markets can play in a producer’s favor by presenting attractive pricing opportunities as traders pump risk premiums into commodities in an attempt to stay ahead of supply limitations,” he notes. Green takes a closer look and walks through some different marketing strategies in yesterday’s Ag Marketing IQ blog – click here for details.
Is it time for a “mindset reset” for 2023? “Because the ag operating environment has seen changes in the past year – and the internal circumstances of your farm operation may have changed significantly since then as well – this next year may require some different choices or decision-making than perhaps what was done in recent years,” according to Darren Frye, CEO of Water Street Solutions. Frye offers additional advice in his latest Finance First column – click here to learn more.
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 in just a few short weeks. 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.
Grain traveling the nation’s railways saw another 18,198 carloads last week. That brings cumulative totals for 2022 up to 1.069 million carloads, which is 6.4% below last year’s pace so far.
Preliminary volume estimates were for 146,716 contracts, which was moderately below Tuesday’s final count of 175,723.
Soybeans
Soybean prices benefited from dry forecasts in Argentina coupled with the easement of covid-related restrictions in China, which could bode well for U.S. export demand moving forward. January futures rose 26.5 cents to $15.0875, with March futures up 27.5 cents to $15.1650.
Soybean basis bids held steady across the central U.S. on Wednesday.
Farm Progress has a new policy editor, Joshua Baethge. What better way throw him into the deep end than to have him explore the massive $1.7 trillion omnibus spending bill will keep the federal government running through the end of fiscal year 2023? This bill also contains billions in direct benefits to U.S. farmers in the form of disaster aid, along with programs that address climate change, aflatoxin damage in corn, and much more. Baethge dug through the details in his latest reporting – click here to learn more.
China’s top diplomat Wang Yi, speaking this past weekend at a symposium on foreign relations, hinted that the country plans to ramp up efforts to improve the trade temperature with the United States and other partners, including a “follow through on the common understandings reached between the Chinese and U.S. Presidents.” Wang also said China will increase high-level negotiations with Europe. Click here to learn more.
What’s your top 2023 farm bill priority? That’s what the latest Farm Progress PANEL asked, and a majority (58%) of respondents indicated that continued crop insurance support was No. 1 on their list. To see what other options were popular, and to learn how to participate in future PANEL surveys, click here.
Egypt purchased 30,000 metric tons of soyoil plus another 12,000 MT of sunflower oil in an international tender that closed on Wednesday. Additional shipping details were not immediately available.
Preliminary volume estimates were for 178,381 contracts, shifting moderately below Tuesday’s final count of 252,902.
Wheat
Wheat prices saw variable gains after traders continued to assess the extent of winterkill damage to U.S. crops and short-term global demand signals. March Chicago SRW futures rose 11 cents to $7.8550, March Kansas City HRW futures added 3.5 cents to $8.8275, and March MGEX spring wheat futures picked up a penny to $9.3525.
Russian consultancy Sovecon slightly raised its forecast for the country’s 2022/23 wheat production, moving that total to 3.718 billion bushels. Sovecon cited better yields in the country’s Central and Siberian production regions. Russia is the world’s No. 1 wheat exporter.
Persistent drought conditions in Argentina had the country’s Rosario grains exchange reducing its 2022/23 wheat production estimates by another 11 million bushels for a total of 422.6 million bushels. Per-acre yields are at the lowest levels in more than a decade, according to the exchange.
Egypt purchased 7.3 million bushels of wheat, sourced from Russia, in a dealt hat recently closed. The grain is comprised of five shipment that will all take place over the first half of February.
Preliminary volume estimates were for 42,464 CBOT contracts, which was 15% above Tuesday’s final count of 36,827.
| Settlement Prices for Key Commodities | ||||
| High | Low | Last | Change | |
| Corn $/bushel | ||||
| 23-Mar | 683.5 | 672.75 | 682.75 | 8.25 |
| 23-May | 682 | 671.25 | 681.5 | 8.25 |
| Soybeans | ||||
| 23-Jan | 1509.75 | 1482.75 | 1506.5 | 26.5 |
| 23-Mar | 1517.5 | 1489.5 | 1514.25 | 27.5 |
| Soymeal $/ton | ||||
| 23-Mar | 463.7 | 448.5 | 461.3 | 14.9 |
| Soyoil cents/lb | ||||
| 23-Mar | 66.66 | 64.37 | 64.97 | -1.38 |
| Wheat $/bushel | ||||
| 23-Mar | 787.5 | 770.75 | 785.5 | 11 |
| 23-May | 794 | 778.5 | 792.75 | 11.5 |
| KC Wheat | ||||
| 23-Mar | 891.75 | 875.5 | 882.25 | 3.5 |
| 23-May | 884 | 868.5 | 876.75 | 5 |
| MPLS Wheat | ||||
| 23-Mar | 939 | 928.25 | 934 | 1 |
| 23-May | 927.75 | 917 | 921.25 | 2 |
| Live Cattle cents/lb | ||||
| 22-Dec | 157.5 | 156.6 | 157.4 | 0.575 |
| Feeder Cattle cents/lb | ||||
| 23-Mar | 186.375 | 184.8 | 186 | 0.6 |
| Lean Hogs cents/lb | ||||
| 23-Apr | 96.85 | 95.5 | 96.2 | -0.25 |
| Crude Oil $/barrel | *Energy prices may not represent final settlements | |||
| 23-Feb | 79.92 | 77.3 | 78.9 | -0.63 |
| Diesel | ||||
| 23-Jan | 3.3937 | 3.227 | 3.3677 | 0.014 |
| Unleaded Gasoline $/gallon | ||||
| 23-Jan | 2.3731 | 2.2967 | 2.3572 | -0.003 |
| Natural Gas | ||||
| 23-Feb | 5.083 | 4.462 | 4.721 | -0.397 |
| U.S. Dollar Index | ||||
| 23-Mar | 104.21 | 103.565 | 104.13 | 0.237 |
| Gold $/ounce | ||||
| 23-Feb | 1822.8 | 1804.2 | 1806.3 | -10 |
| Copper | ||||
| 22-Dec | 3.842 | 3.819 | 3.8245 | -0.009 |
| Fertilizer Swaps | (as of 12/23) | |||
| 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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