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Bean basis slumps on weakening export market

Agriculture.com Staff 04/23/2009 @ 7:02am

Grain basis levels were mixed this week as corn managed to gain nearly 2 cents a bushel, while soybeans sank 2 cents a bushel.

Most of the impetus for change came from the Gulf export market. This week, corn basis at the Gulf climbed 3 cents a bushel while the soybean Gulf bid was off 9 cents on basis.

Regionally, corn basis posted the biggest gains along sections of the Illinois and Mississippi River system, but the majority of the Western Cornbelt and Plains saw basis levels that were mostly unchanged or even slightly weaker over the past week.

For soybeans, basis levels on the River system were off thanks to the Gulf market slump over the past week. Most of the country saw fairly modest losses, but portions of the Western Cornbelt managed to hold fairly stable.

As we get into full swing for planting in the coming weeks, look for spot basis levels to begin to firm up as farmers limit their cash sales. Furthermore, some grain buyers have become more proactive in their pricing of late summer/early fall delivery especially for soybeans. With a tight old-crop soybean supply, we are starting to see basis levels for Aug and early Sep delivery begin to improve, so keep abreast of potential forward pricing opportunities in your area. The table below illustrates the change in basis over the past week for various delivery periods. August soybean delivery moved higher by nearly 5 cents a bushel over the past week.

  • Jun Delivery: Corn +1.8; soybeans +2.3
  • Jul Delivery: Corn +1.6; soybeans +2.5
  • Aug Delivery: Corn 0; soybeans +4.8
  • Sep Delivery: Corn 0; soybeans -4.5
  • Oct Delivery: Corn 0; soybeans +2.5

Grain basis levels were mixed this week as corn managed to gain nearly 2 cents a bushel, while soybeans sank 2 cents a bushel.

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