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Afternoon Market Recap for Jan. 21, 2021

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Corn hangs on for small gains.

Soybeans fade again, with wheat facing a moderate drop Thursday

Grains were mixed but mostly lower Thursday on an uneven round of technical maneuvering. Corn stayed in the green, carving out gains of about 0.25%, although prices were even higher in overnight trading heading into today’s session. Soybeans started the session with moderate gains, which evaporated and reversed into small losses by the close. Wheat contracts faced the most downside, with some contracts losing more than 1.25% today.

Most of the Midwest and Plains will gather another 0.1” to 0.25” of additional rain or snow between Friday and Monday, per the latest 72-hour cumulative precipitation map from NOAA. As the month closes out, expect warmer-than-normal conditions to continue throughout the central U.S. between January 28 and February 3, with some seasonally wet weather probable in the Great Lakes region.

On Wall St., the Dow picked up another 51 points in afternoon trading to reach 31,239, anchored by strong performances from tech stocks, along with optimism that the Biden Administration will put forth a solid coronavirus vaccination plan. Energy futures were lightly mixed. Crude oil dropped about 0.25% lower this afternoon but remains above $53 per barrel. Diesel rose fractionally, with gasoline up around 0.4%. The U.S. Dollar softened moderately.

On Wednesday, commodity funds were net sellers of most grain contracts, including corn (-9,000), soybeans (-10,000), soymeal (-5,000) and CBOT wheat (-3,500) but were net buyers of soyoil (+5,000).

NOTE: Due to Monday’s Martin Luther King, Jr. holiday, USDA’s next weekly export sales report, which usually drops Thursday morning, will be released a day later.

Corn

Corn prices sputtered as Thursday’s session wore on but still closed slightly higher thanks to a buffer of overnight gains. A flash sale of 13 million bushels announced earlier this morning lent some support, while lower soybean and wheat prices created some headwinds. March futures added 1.25 cents to $5.2325, with May futures up 1.75 cents to $5.2575.

Corn basis bids rose 1 to 2 cents higher at two interior river terminals but dipped 2 to 3 cents lower across two other Midwestern locations Thursday. Most bids remained steady today

Private exporters reported to USDA export sales of 13 million bushels of corn for delivery to unknown destinations for the 2020/21 marketing year, which began September 1.

Ahead of tomorrow morning’s weekly export report from USDA, analysts expect the agency to show corn sales ranging between 23.6 million and 47.2 million bushels for the week ending January 14

IHS Markit is forecasting 2021 U.S. corn acres to reach 94.244 million acres, which would be 4% higher than last year’s tally, if realized. Assuming average yields of 181.0 bushels per acres, that would leave a production topping 15.65 billion bushels this year.

The U.S. EPA reports that 1.15 billion ethanol blending credits were generated in December, up slightly from November’s tally of 1.14 billion. And 447 million biodiesel blending credits were also generated in December, which is up moderately versus November’s total of 390 million.

Preliminary volume estimates were for 310,368 contracts, moderately trailing Wednesday’s final count of 395,939.

Soybeans

Soybean prices dropped throughout Thursday’s session, despite collecting healthy overnight gains and gathering another two large export sales this morning, as traders succumbed to another round of technical selling. March futures closed down 1.5 cents to $13.68, with May futures dipping 0.75 cents to $13.6650.

Soybean basis bids were largely steady across the central U.S. Thursday but did tilt 5 cents lower at an Iowa processor today.

Private exporters announced two new large soybean sales to USDA. The first was for 5.0 million bushels to China, and the second was for 6.0 million bushels to Mexico. Both sales are for delivery during the 2020/21 marketing year, which began September 1.

Ahead of Friday morning’s weekly export report from USDA, analysts expect the agency to show soybean sales ranging between 40.4 million and 77.2 million bushels for the week ending January 14. Analysts also predict soymeal sales ranging between 100,000 and 400,000 metric tons last week, plus another 10,000 to 30,000 MT of soyoil sales.

IHS Markit estimates that 2021 soybean plantings in the U.S. will reach 90.080 million acres, which would be 8% above last year’s acres, if realized. Assuming average yields of 52.0 bushels per acre, that would create a total harvest of 4.638 billion bushels this year.

IHS Markit also projects Brazil’s 2020/21 soybean production at 4.887 billion bushels, moving 18.4 million bushels above its prior estimate. Acreage estimates remain steady, with 95.136 million acres. The group says Mato Grosso (the No. 1 production state) is on the decline but other states have seen a “positive surprise” this season.

Preliminary volume estimates were for 192,087 contracts, spilling below Wednesday’s final tally of 309,580.

Wheat

Wheat prices faced another round of moderate cuts Thursday on a round of technical selling, closing lower for the third consecutive session. Traders await tomorrow morning’s export report from USDA for more direction after analysts offered a broad range of guesses for wheat sales. March Chicago SRW futures lost 9 cents to $6.5875, March Kansas City HRW futures fell 4 cents to $6.33, and March MGEX spring wheat futures dropped 3 cents to $6.3450.

Private exporters announced to USDA a sale of 5.1 million bushels of hard red winter wheat for delivery to Nigeria during the 2021/22 marketing year, which begins June 1.

Prior to Friday morning’s weekly export report from USDA, analysts think the agency will show wheat sales ranging between 9.2 million and 23.9 million bushels for the week ending January 14.

IHS Markit estimates that U.S. all-wheat plantings in 2021 will reach 45.281 million acres. That includes 31.991 million acres of winter wheat, along with 11.490 million acres of spring wheat and 1.8 million acres of durum wheat.

Algeria ended up purchasing 14.3 million bushels of milling wheat from optional origins in an international tender that closed yesterday. The grain is for shipment in February.

Tunisia issued an international tender to purchase 3.4 million bushels of soft wheat, 3.4 million bushels of durum wheat and 3.4 million bushels of animal feed barley from optional origins that closes tomorrow. The grain is for shipment between mid-February and late March.

Jordan issued a new international tender to purchase 4.4 million bushels of milling wheat from optional origins that closes January 27. The grain would be for shipment between August and September.

Japan purchased 2.7 million bushels of food-quality wheat from the United States and Canada in a regular tender that closed earlier today. As expected, 71% was sourced from the U.S.

Preliminary volume estimates were for 87,395 CBOT contracts, falling moderately below Wednesday’s final count of 147,647.

Closing Prices for Key Commodities 
  High Low Last Change
Corn                     $/bushel  cents/bu    
21-Mar 531.5 519.25 524.25 1.25
21-May 533.25 521.5 526.25 1.75
Soybeans        
21-Mar 1387 1365.5 1370.25 -1.5
21-May 1384.75 1363.5 1368.75 -0.75
Soymeal                $/ton        
21-May 443 434.1 435.3 -4
Soyoil                    cents/lb        
21-May 42.82 41.72 42.75 0.74
Wheat                    $/bushel        
21-Mar 674.75 657.75 660.75 -9
21-May 674.5 659.25 662.25 -7.5
KC Wheat        
21-Mar 646.5 632.25 635.75 -4
21-May 649 635.75 639 -4
MPLS Wheat        
21-Mar 644 632.25 635.25 -3
21-May 652.5 641.25 644.25 -2.5
Live Cattle             cents/lb        
21-Feb 114.375 113.05 114.3 0.95
Feeder Cattle         cents/lb        
21-Mar 139.45 136.575 139.3 1.775
Lean Hogs             cents/lb        
21-Apr 74.975 73 73.975 0.9
Crude Oil  $/barrel *Energy prices may not represent final settlements      
21-Feb 53.41 52.75 53.12 -0.19
Diesel        
21-Feb 1.6025 1.5835 1.5999 -0.0005
Unleaded Gasoline   $/gallon        
21-Feb 1.5515 1.5285 1.5493 0.0054
Natural Gas        
21-Mar 2.541 2.462 2.498 -0.035
Ethanol Futures        
21-Feb 1.6 1.6 1.6 -0.03
U.S. Dollar Index        
21-Mar 90.405 90.03 90.125 -0.344
Gold                      $/ounce        
21-Feb 1874.6 1857.5 1868 2.1
Copper        
21-Jan 3.659 3.644 3.646 -0.0015
Fertilizer Swaps     (as of 01/15)  
DAP Tampa-index              405.0 15
DAP-New Orleans              444.8 12
Urea-New Orleans              330.1 34
Urea-Middle East              315.0 19
Urea-Black Sea              287.5 28
UAN (32%) New Orleans              162.6 16.53

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