Afternoon report: Corn prices finish Monday’s session with modest losses.
Grain prices were truly a mixed bag to start the week. On the positive side of the ledger were wheat prices, which firmed another 1.25% to 3% higher on a round of technical buying largely fueled by concerns about U.S. crop quality and Ukrainian production potential. Other grains failed to follow suit, however. Ample wet weather could spell planting delays in parts of the Midwest, and more farmers could swap out corn acres for soybeans – which left prices stumbling more than 1.75% lower. Corn losses were more modest, with nearby contracts down 0.5% by the close.
The Northern Plains and upper Midwest should gather considerable moisture later this week, per the latest 72-hour cumulative precipitation map from NOAA. The Mid-South could also see significant rainfall between today and Thursday. Later on, NOAA’s 8-to-14-day outlook predicts seasonally dry weather returning to the Plains and western Corn Belt between April 18 and April 24, with colder-than-normal conditions likely for most of the country next week.
On Wall St., the Dow stumbled 283 points lower in afternoon trading to 34,437 as concerns over rising interest rates continue to rattle investors. Energy futures saw significant cuts as the world watched lockdown measures in China closely. Crude oil dropped 3.5% this afternoon to fall below $95 per barrel. Gasoline fell 3.5%, with nearby diesel contracts down 0.5%. The U.S. Dollar firmed moderately.
On Friday, commodity funds were significant net buyers of all major grain contracts, including corn (+9,000), soybeans (+15,000), soymeal (+4,000), soyoil (+5,000) and CBOT wheat (+15,000).
NOTE: Keeping up with crop conditions and development across the country can be challenging as planting season nears, but Farm Futures is here to help. Our Feedback from the Field series is back for another year to help farmers across the country share their views on the 2022 growing season. Click here to find out how to participate – we’d love to hear from you!
Corn
Corn prices failed to hold onto moderate overnight gains, ultimately following soybeans lower on a round of technical selling by the close today. May futures dropped 4.25 cents to $7.6450, with July futures down 1.5 cents to $7.5925.
Corn basis bids were steady at most Midwestern locations to start the week but did firm 5 to 6 cents higher at two locations while sliding 2 cents lower at two other locations on Monday.
Private exporters announced the sale of 40.2 million bushels of corn to China. Roughly two-thirds of the total is for delivery during the current marketing year, which began September 1, and the remainder is for delivery in 2022/23.
Corn export inspections reached 55.9 million bushels in the week through April 7, which was a weekly decline of around 8%. It was also a bit on the lower end of trade guesses, which ranged between 43.3 million and 76.9 million bushels. China was the No. 1 destination, with 18.6 million bushels. Cumulative totals for the 2021/22 marketing year are still moderately below last year’s pace, with 1.260 billion bushels.
Ahead of the next USDA crop progress report, out later this afternoon and covering the week through April 10, analysts expect the agency to show 4% of the 2022 corn crop planted, up from 2% last week.
In Argentina, a trucking strike has begun in pursuit of higher rates when transporting livestock and grain. “There are no negotiations currently underway,” according to a spokesman from the Federation of Argentine Transporters. Approximately 85% of Argentina’s grain is transported from fields to ports via trucks. Argentina is among the world’s top exporters of corn, soybeans and soymeal.
Will farmers cut nitrogen rates enough in 2022 to derail trendline yield potential or is there enough residual nutrients in your fields to limit losses this season? It will be especially important to monitor how management, crop and weather variables can affect crop the soil’s ability to provide what your crops need. Click here to learn more.
Preliminary volume estimates were for 344,100 contracts, sliding slightly below Friday’s final count of 357,347.
Soybeans
Soybean prices saw heavy cuts as wet weather across the central U.S. could increase the likelihood for an acreage swap later this spring. Soybean acres are already forecast to surpass corn acres for the third time ever. May futures tumbled 31 cents to $16.58, with July futures down 24.25 cents to $16.4375.
Soybean basis bids tracked 5 to 15 cents higher at two Midwestern processors and firmed 5 cents at an Iowa river terminal while holding steady elsewhere across the central U.S. on Monday.
Soybean export inspections made modest week-over-week improvements to reach 28.2 million bushels. That was also toward the higher end of trade guesses, which ranged between 18.4 million and 33.1 million bushels. China was the No. 1 destination, with 15.6 million bushels. Cumulative totals for the 2021/22 marketing year are still substantially below last year’s pace, with 1.651 billion bushels.
What does your marketing plan look like this year? How do you plan to size up opportunities in the market? Several experts will be on hand starting Tuesday to answer these questions and more during the next Farm Progress 365 online series. Click here to learn how to get started!
Preliminary volume estimates were for 212,956 contracts, inching slightly below Friday’s final count of 215,917.
Wheat
Wheat prices bounced higher on poor U.S. quality ratings, coupled with worries about export potential in Ukraine, which will also face unique harvest challenges this season in the form of Russian landmines in some fields. May Chicago SRW futures rose 29 cents to $10.8050, May Kansas City HRW futures climbed 33.5 cents to $11.4025, and May MGEX spring wheat futures added 14.75 cents to $11.42.
Wheat export inspections firmed 29% week-over-week to reach 15.1 million bushels. That was also on the very high end of trade estimates, which ranged between 9.2 million and 16.5 million bushels. The Philippines topped all destinations, with 2.4 million bushels. Cumulative totals for the 2021/22 marketing year are moderately trailing last year’s pace, with 647.7 million bushels.
Ahead of the next crop progress report from USDA, analysts expect the agency to show just 30% of the winter wheat crop rated in good-to-excellent condition through April 10. If realized, it would be the worst quality ratings for winter wheat at this time of year since 1996. Analysts also estimate that 9% of the 2022 spring wheat crop has been planted.
Thanks in large part to a record-breaking wheat harvest of 4.090 billion bushels last season, India is in a good position to export much more grain than usual as the war rages on in Ukraine. Even after a record export pace of 288.4 million bushels in the fiscal year through March, governmental stocks are at an unprecedented 698.1 million bushels. The country is also sitting on a sizeable sugar surplus.
Russia’s Sovecon consultancy estimates that the country’s wheat exports in April will reach 69.8 million bushels. That would be a month-over-month decline of 14%, if realized, but still well ahead of year-ago totals. Russia is the world’s No. 1 wheat exporter.
Before the war, Ukraine’s monthly grain export capacity was around 6 million metric tons (the equivalent of 236 million bushels of corn or 220 million bushels of wheat). In March, the country only exported 300,000 MT of grain. But Ukraine hopes to scale back to 600,000 MT in April and ratchet up capacity to 2 million MT later this year.
China sold 19.4 million bushels of its state wheat reserves on auction last week, which was more than 95% of the total available on offer. China has offered 11 other similarly sized grain auctions earlier this year as it tries to shore up domestic needs and quell high feed prices.
Bangladesh is considering offers in its international tender to purchase 1.8 million bushels of wheat from optional origins that closed earlier today. The grain will be shipped 40 days after a contract is signed.
Preliminary volume estimates were for 136,943 CBOT contracts, trending moderately above Friday’s final count of 104,508.
Settlement Prices for Key Commodities
High
Low
Last
Change
Corn $/bushel
22-May
778
762
764.5
-4.25
22-Jul
770.75
755.5
758.75
-1.5
Soybeans
22-May
1697.5
1651.5
1655.25
-31
22-Jul
1676.5
1635.5
1640.75
-24.25
Soymeal $/ton
22-Jul
465.7
452.7
454.2
-8.3
Soyoil cents/lb
22-Jul
74.07
72.46
72.91
-0.48
Wheat $/bushel
22-May
1091.75
1055
1081.25
29
22-Jul
1096.5
1061.25
1089
30
KC Wheat
22-May
1157.25
1109.25
1141.5
33.5
22-Jul
1160
1112.25
1145.5
33.25
MPLS Wheat
22-May
1160.25
1123.75
1142
14.75
22-Jul
1158
1122
1140.5
13
Live Cattle cents/lb
22-Apr
138.65
137.6
138.525
0.7
Feeder Cattle cents/lb
22-May
160.1
156.85
160.025
0.65
Lean Hogs cents/lb
22-May
109.35
107.125
108.825
0.4
Crude Oil $/barrel
*Energy prices may not represent final settlements
22-May
98.52
92.93
94.24
-4.02
Diesel
22-May
3.3586
3.2196
3.2705
-0.0471
Unleaded Gasoline $/gallon
22-May
3.1284
2.9931
3.005
-0.1266
Natural Gas
22-Jun
6.753
6.327
6.701
0.345
U.S. Dollar Index
22-Jun
100.05
99.61
99.92
0.167
Gold $/ounce
22-May
1970.8
1940.8
1944.2
2.6
Copper
22-Apr
4.7065
4.623
4.623
-0.097
Fertilizer Swaps
(as of 04/01)
DAP Tampa-index
1,240.0
222
DAP-New Orleans
1,085.8
-16.53
Urea-New Orleans
1,002.0
9.92
Urea-Middle East
1,130.0
0
Urea-Black Sea
585.0
35
UAN (32%) New Orleans
689.0
2.76
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