KC wheat tops $9 per bushel.
Corn, soybeans and wheat prices all continue to push higher Wednesday
The mounting crisis in Ukraine has left stock prices in disarray so far this week, but worries about export disruptions have kept grain prices firmly in the green. Winter wheat prices led the charge again today, rising around 3.5% higher by the close. Of particular note, Kansas City HRW contracts crossed the $9-per-bushel benchmark for the first time since 2013. Soybeans marched more than 2% higher, with corn up around 1% today.
Winter Storm Oaklee is moving across the Midwest and Plains this week, delivering snow, ice and other inclement weather along the way. According to NOAA’s latest 72-hour cumulative precipitation map shows the Ohio River Valley is still set to gather the most moisture between Thursday and Sunday. NOAA’s 8-to-14-day outlook predicts seasonally wet weather for most of the Midwest and Plains between March 2 and March 8, with warmer-than-normal conditions likely for most of the Corn Belt during this time.
On Wall St., the Dow was trending lower for a fourth consecutive session, dropping another 302 points in afternoon trading to 33,293. Investors remain quite skittish over escalating tensions between Russia and Ukraine. Energy futures moved modestly higher. Crude oil shifted another 0.2% higher this afternoon to stay just above $92 per barrel. Diesel added 0.4%, with gasoline up 0.5%. The U.S. Dollar firmed moderately.
On Tuesday, commodity funds were net buyers of all major grain contracts, including corn (+23,500), soybeans (+18,500), soymeal (+3,000), soyoil (+8,500) and CBOT wheat (+19,000).
Corn
Corn prices followed other grains higher after another round of technical buying on Wednesday. The two driving factors continue to be South American production potential and whether Russia ends up invading Ukraine. Today, March futures added 7 cents to $6.8175, with May futures up 6.75 cents to $6.7925.
Corn basis bids were mostly steady to firm on Wednesday after trending 2 to 4 cents higher at three Midwestern locations. An Illinois river terminal bucked the overall trend after sliding a penny lower today.
A poll of 14 analysts suggests that 2022 corn plantings could reach 91.8 million acres. Individual trade guesses ranged from 90.4 million to 93.5 million acres. Assuming average yields of 179.2 bushels per acre, that would lead to a total production of 15.053 billion bushels this season.
Brazilian consultancy Datagro increased its forecast for 2021/22 total corn production by 2.3% to reach 4.638 billion bushels.
The current geopolitical turmoil in the Black Sea region is a stark reminder that energy prices and security is a complex issue, according to the Renewable Fuel Association’s Geoff Cooper, speaking at this week’s National Ethanol Conference. “We cannot frack our way to low gas prices and energy security,” he says. “Whether we like it or not, pump prices here in America continue to be shaped by the whims of OPEC and geopolitical events–like the current situation in Ukraine.” Learn more about the latest reporting from Farm Futures policy editor Jacqui Fatka here.
Preliminary volume estimates were for 409,005 contracts, tracking 8% below Tuesday’s final count of 444,168.
Soybeans
Soybean prices found more positive momentum Wednesday, rising more than 2% by the close after a round of technical buying partly spurred by doubts over South American production potential. Spillover strength from other grains lent some additional support today. March futures climbed 40 cents to $16.75, with May futures rising 35 cents to $16.70.
Soybean basis bids jumped 8 cents higher at an Ohio elevator and 16 cents higher at an Illinois river terminal while dipping 2 cents lower at another Illinois river terminal on Wednesday. Other Midwest locations held steady today.
Private exporters announced the sale of 4.9 million bushels of soybeans for delivery to China during the 2022/23 marketing year, which begins September 1.
A poll of 14 analysts showed expectations for 2022 soybean plantings is at 89.5 million acres, with individual guesses ranging between 97.5 million and 92.4 million acres. Assuming average yields of 51.5 bushels per acre, that would lead to a total production of 4.556 billion bushels.
Brazilian consultancy Datagro slightly raised its estimates for the country’s 2021/22 soybean production, moving up to 4.786 billion bushels. This is one of the more bullish estimates currently being floated for this season’s production.
Iran issued an international tender to purchase 60,000 metric tons of soymeal that closes today. In a separate tender, Iran also is seeking to buy 2.8 million bushels of animal feed barley. The country has been an active grain buyer in recent months after coming off the worst drought in five decades.
Preliminary volume estimates were for 327,617 contracts, inching slightly above Tuesday’s final count of 326,462.
Wheat
Wheat prices captured considerable gains after another round of ample technical buying on Wednesday. The ongoing Ukrainian/Russian conflict is by far the biggest driver of these huge gains in recent sessions. March Chicago SRW futures climbed 30.25 cents to $8.7450, March Kansas City HRW futures rose 29.5 cents to $9.1125, and March MGEX spring wheat futures gained 15.25 cents to $10.01.
USDA reports that only 26% of the 2021/22 Kansas winter wheat crop is rated in good-to-excellent condition through February 20. That’s down from 30% a month ago. Kansas is the country’s top winter wheat producer. In the No. 2 producing state, Oklahoma, only 9% of the crop is in good-to-excellent condition, down from month-ago ratings of 16%.
Ukraine’s state statistics service reported that the country’s total wheat harvest in 2021 rose nearly 29% higher year-over-year, reaching 1.179 billion bushels. Ukraine’s corn production was even better from the prior year, trending 38% higher to reach 1.648 billion bushels. Ukraine is one of the world’s top exporters of both crops.
Turkey issued an international tender to purchase 16.0 million bushels of milling wheat from optional origins that closes March 2. The grain is for shipment starting on March 10. Turkey remains an active grain buyer as it continues to shore up domestic supplies after harvesting a drought-damaged crop.
Importers in Thailand issued an international tender to purchase 10.8 million bushels of animal feed wheat from optional origins that closes today. The grain is split into several consignments that will be shipped between March and June.
Bangladesh purchased 1.8 million bushels of milling wheat from optional origins in an international tender that closed last week. The grain is for shipment 40 days after the contract is signed.
Preliminary volume estimates were for 201,289 CBOT contracts, shifting slightly ahead of Tuesday’s final count of 198,204.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-Mar
685
669.25
683.75
7
22-May
682.25
667.5
681.25
6.75
Soybeans
22-Mar
1679.5
1636.5
1675
40
22-May
1675
1636
1671
35
Soymeal $/ton
22-May
469.4
450.5
466
14.8
Soyoil cents/lb
22-May
71.24
69.97
70.58
0.49
Wheat $/bushel
22-Mar
880
834
876
30.25
22-May
888.75
842.75
884.75
30.75
KC Wheat
22-Mar
917.5
871.25
913.5
29.5
22-May
921.5
876.75
918
29.25
MPLS Wheat
22-Mar
1003.75
976
1001
15.25
22-May
1004.25
976.5
1002.75
13.75
Live Cattle cents/lb
22-Feb
144.05
143.025
143.225
-0.525
Feeder Cattle cents/lb
22-Apr
169.85
167.725
168.55
-0.575
Lean Hogs cents/lb
22-Apr
116.1
112.475
112.75
-2.9
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-Mar
93.9
90.64
91.78
-0.13
Diesel
22-Mar
2.8525
2.7742
2.8262
0.0074
Unleaded Gasoline $/gallon
22-Mar
2.7744
2.6942
2.7151
0.0043
Natural Gas
22-Apr
4.685
4.437
4.555
0.094
U.S. Dollar Index
22-Mar
96.21
95.835
96.185
0.174
Gold $/ounce
22-Mar
1911.5
1890.4
1910.6
4.5
Copper
22-Feb
4.5205
4.506
4.5205
0.0105
Fertilizer Swaps
(as of 02/18)
DAP Tampa-index
835.0
25
DAP-New Orleans
837.8
33
Urea-New Orleans
584.2
-22
Urea-Middle East
600.0
-65
Urea-Black Sea
550.0
-110
UAN (32%) New Orleans
606.3
0
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