Grain prices were mixed after some uneven technical maneuvering on Wednesday. Corn prices managed to erase moderate overnight losses, closing with modest gains of around 0.25%. Soybeans failed to follow suit, suffering 1% losses on a technical setback today. Wheat prices were mixed – CBOT contracts moved modestly lower, while Kansas City HRW and MGEX spring wheat contracts stayed in the green.
Most of the Midwest and Plains will fail to gather additional moisture between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. Southern states continue to be severely impacted by an ongoing ice storm that has stunted travel and left thousands without power. NOAA’s new 8-to-14-day outlook predicts a return to seasonally wet weather for the Corn Belt between February 8 and February 14, with warmer-than-normal conditions likely for the eastern half of the United States during that time.
On Wall St., the Dow eased 15 points lower in afternoon trading to 34,070 as investors reacted to a quarter-point rate hike from the Federal Reserve, announced earlier today. Energy futures moved sharply lower, with crude oil tracking 3% lower this afternoon to $76 per barrel on rising supplies. Diesel tumbled 6% lower, while gasoline lost 4.25%. The U.S. Dollar softened moderately.
On Tuesday, commodity funds were net buyers of soybeans (+4,000), soyoil (+4,000) and CBOT wheat (+4,500) contracts but were net sellers of corn (-2,000) and soymeal (-3,500).
Corn
Corn prices tested modest gains after spending much of Wednesday’s session in the red. March futures added 1.25 cents to $6.81, with May futures up 1.75 cents to $6.7925.
Corn basis bids were steady to firm after trending 2 to 5 cents higher across three Midwestern locations on Wednesday.
Ethanol production increased for the fourth consecutive week, with a daily average of 1.028 million barrels through January 27, according to the latest data from the U.S. Energy Information Administration, released this morning. Stocks were trimmed by 3%.
Prior to Thursday morning’s USDA export report, analysts expect the agency to show corn sales ranging between 23.6 million and 53.1 million bushels for the week ending January 26.
A recent report from USDA-FAS has Brazil’s 2022/23 corn production estimated at 4.941 billion bushels. That would be a year-over-year improvement of 8%, if realized. Export estimates are currently at 1.850 billion bushels.
The latest data from the European Commission shows EU corn imports during the 2022/23 marketing year at 648 million bushels through January 29. That’s a year-over-year jump of 73% so far. Ukraine, Brazil, Canada, Serbia and Russia have been the top five suppliers.
South Korea purchased 4.6 million bushels of animal feed corn from optional origins in an international tender that closed earlier today. The grain is for arrival in May.
Egypt received multiple offers in its international tender to purchase an unspecified amount of corn. The cheapest bid was for 2.2 million bushels sourced from the United States. However, Egypt is believed to have canceled this tender, although additional details were not immediately available.
Preliminary volume estimates were for 304,117 contracts, trending moderately above Tuesday’s final count of 264,218.
Soybeans
Soybean prices took a double-digit tumble on Wednesday as traders remain focused on South American weather trends that could affect production potential. Argentina is struggling relatively (for now), while Brazilian production is expected to climb to record-breaking levels. March futures dropped 17.75 cents to $15.2025, with May futures down 13.75 cents to $15.1650.
Soybean basis bids were steady to mixed across the central U.S. on Wednesday, moving as much as 4 cents lower at an Ohio elevator and as much as 10 cents higher at a Nebraska processor today.
Ahead of tomorrow morning’s export report from USDA, analysts think the agency will show soybean sales ranging between 25.7 million and 58.8 million bushels for the week ending January 26. Analysts also expect to see soymeal sales come in between 200,000 and 475,000 metric tons, plus up to 20,000 MT of soyoil sales last week.
European Union soybean imports during the 2022/23 marketing year have reached 229.3 million bushels through January 29, which is moderately below last year’s pace so far. EU soymeal imports are also below year-ago totals, with 9.19 million metric tons during the same period.
A recent report from USDA-FAS has significantly lowered the agency’s estimates for Argentina’s 2022/23 soybean production to 1.323 billion bushels, citing “dry weather and high temperatures in the last months of 2022.” Better-than-normal weather through the rest of February will be needed for substantial recovery, according to the report.
Preliminary volume estimates were for 243,651 contracts, shifting slightly above Tuesday’s final count of 238,084.
Wheat
Wheat prices were lightly mixed after some uneven technical maneuvering on Wednesday. March Chicago SRW futures faded 3.25 cents lower to $7.58, while March Kansas City HRW futures added 4.25 cents to $8.8325 and March MGEX spring wheat futures picked up 3.25 cents to $9.2550.
Prior to Thursday morning’s export report from USDA, analysts expect the agency to show wheat sales ranging between 11.0 million and 32.2 million bushels for the week ending January 26.
European Union soft wheat exports during the 2022/23 marketing year are trending moderately above last year’s pace so far after reaching 690 million bushels through January 29. Morocco, Algeria, Egypt, Nigeria and Saudi Arabia have been the top five buyers so far.
South Korea purchased 2.4 million bushels of animal feed wheat, likely sourced from Australia, in an international tender that closed earlier today. The grain is for shipment between late June and mid-July.
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