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Ag Markets Are Quiet Ahead of Today’s USDA Data

Corn, wheat markets trade slightly higher.

DES MOINES, Iowa -- On Friday, the CME Group’s farm markets have started mostly higher, with only soybeans off a few cents.

At 9:05 a.m., the March corn futures are ½¢ higher at $3.49; May futures are ½¢ lower at $3.57.

March soybean futures are 2¼¢ lower at $9.47; May soybean futures are 2¢ lower at $9.59.

March wheat futures are ¾¢ higher at $4.34.

March soy meal futures are 70¢ per short ton lower at $312.40. January soy oil futures are 0.13¢ lower at 33.02¢ per pound. 

In the outside markets, the NYMEX crude oil market is 21¢ lower, the U.S. dollar is lower, and the Dow Jones Industrials are 151 points higher.

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Thursday’s Grain Market Review

The farm markets trade mostly weaker, with low volume and weak export news Thursday.

At the close, the March corn futures finished ¼¢ lower at $3.48¾; May corn futures ended even at $3.57.

March soybean futures settled 5¢ lower at $9.50; May soybean futures closed 5¢ lower at $9.61.

March wheat futures closed 1¢ lower at $4.33¼.

March soy meal futures finished $3.30 per short ton lower at $313.10. January soy oil futures finished 0.30¢ lower at 33.15¢ per pound. 

In the outside markets, the NYMEX crude oil market is 22¢ higher, the U.S. dollar is lower, and the Dow Jones Industrials are 138 points higher.

Jason Roose, U.S. Commodities grain analyst, says the grains are mixed.

“It’s about pre-USDA Crop Report positioning, as spreads continue to tighten between the corn and soybeans,” Roose says. “Soybeans, absent of any South American weather issues, continue to lose premium with a weaker export outlook increasing U.S. stocks.”

On Thursday, the USDA released its weekly Export Sales Report. It shows weak demand.

  • Corn: 37,700 metric tons vs. the trade’s expectations of between 200,000 and 700,000 mt
  • Soybeans: 617,400 mt vs. the trade’s expectations of between 300,000 and 850,000 mt
  • Wheat: 71,500 mt vs. the trade’s expectations of between 200,000 and 450,000 mt
  • Soybean meal: 209,300 mt vs. the trade’s expectations of between 75,000 and 250,000 mt                  

Separately, private exporters reported to the USDA Thursday export sales of 132,000 metric tons of soybeans for delivery to unknown destinations during the 2017/2018 marketing year.

The marketing year for soybeans began September 1.

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Wednesday’s Grain Market Review

On Wednesday, the CME Group’s farm markets close mixed, ahead of Friday’s USDA reports.

At the close, the March corn futures finished even at $3.49; May futures settled ¼¢ lower at $3.57.

March soybean futures are 8¾¢ lower at $9.55; May soybean futures ended 8½¢ lower at $9.66.

March wheat futures finished 2¢ higher at $4.34.

March soy meal futures closed $1.80 per short ton lower at $316.40. January soy oil futures settled 0.25¢ lower at 33.45¢ per pound. 

In the outside markets, the NYMEX crude oil market is 61¢ higher, the U.S. dollar is lower, and the Dow Jones Industrials are 42 points lower.

Jack Scoville, The PRICE Futures Group’s senior market analyst, says the funds seem to be buying the grains and selling the beans. 

“There is a lot of talk that USDA will cut the export demand by up to 100 million bushels. That seems to be operating on the beans today and did yesterday, as well,” Scoville says. 

He adds, “Wheat charts are flat bullish, although the fundamentals not necessarily so. Volumes traded today are not huge, and the funds seem interested in covering shorts in corn and wheat but adding on in beans, due to the weakening demand story there.”

On Wednesday, private exporters reported to the USDA export sales of 260,000 metric tons of soybeans for delivery to unknown destinations. Of the total, 65,000 metric tons is for delivery during the 2017/2018 marketing year, and 195,000 metric tons is for delivery during the 2018/2019 marketing year.

The marketing year for soybeans began September 1.

 

 

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Tuesday’s Grain Market Review

On Tuesday, the CME Group’s farm markets close mostly higher.

At the close, the March corn futures finished 1¾¢ higher at $3.49; May futures settled 1¾¢ higher at $3.57¼.

March soybean futures ended 3¢ lower at $9.63¾; May soybean futures ended 3¢ lower at $9.74½.

March wheat futures closed 4¾¢ higher at $4.45.

March soy meal futures finished $3.30 per short ton lower at $318.20. January soy oil futures finished 0.16¢ higher at 33.70¢ per pound. 

In the outside markets, the NYMEX crude oil market is $1.32 higher, the U.S. dollar is higher, and the Dow Jones Industrials are 122 points higher.

Jason Ward, Northstar Commodity’s managing director, says the soybean market is lower due to favorable crop weather in Brazil.

“The weather models remain consistent with a Friday/Saturday rain event with 70% coverage for Argentina. Each day that the rain stays in the forecast, confidence grows. Technically, though, we are still holding last week’s lows just under $9.59,” Ward says.
 
Wheat and corn prices both are benefiting from short covering, he says.

“I think it surprised everyone that open interest surged so much in corn yesterday – over 42,000 contracts – and assuming that was on a down day, it was new investors with short positions entering the market. They were at least unable to violate the contract low from December at $3.46½, basis March corn, and, thus, some short covering today,” Ward says.

Wheat continues to hold last week’s lows, keeping its uptrend intact, he says.

“Expectations for Friday’s USDA report for wheat are for less acres. So, it’s possible there will be some supportive data toward wheat. But with both corn and wheat, demand needs to improve and improve dramatically, otherwise short covering rallies will continue to be sold,” Ward says.
 
He adds, “I am hearing basis levels tightening on corn. Just got a call from a good customer in Iowa that Shell Rock, Iowa, buyer pushed basis to 20 under the March, best bid of the year. Nothing is moving in the country, so tighter basis needs to happen to entice producers to bring it out.”

 

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Monday’s Grain Market Review

On Monday, lower farm futures prices continue, despite fresh demand news.

At the close, the March corn futures finished are 4¢ lower at $3.47; May futures are 3½¢ lower at $3.55.

March soybean futures closed 4¢ lower at $9.66; May soybean futures ended 4¢ lower at $9.77.

March wheat futures closed 3¢ lower at $4.27¾.

March soy meal futures closed 40¢ per short ton lower at $321.50. January soy oil futures finished 0.22¢ lower at 33.54¢ per pound. 

In the outside markets, the NYMEX crude oil market is 33¢ higher, the U.S. dollar is higher, and the Dow Jones Industrials are 4 points higher.

Mike North, President Commodity Risk Management Group’s analyst, says the markets are selling off.

“We are seeing continued correction of the rally that ended 2017. The sell-off began last week with follow through today. This will give markets a chance to retest support ahead of the key January WASDE Report. Soybeans, the more volatile of the grain and oilseed markets, have traded two-sided sessions for the last week. This is likely to continue both ahead of the report and through ongoing adjustments to Argentinian weather forecasts,” North says.

On Monday, private exporters reported to the USDA the following activity:
 

  • Export sales of 120,000 metric tons of soybeans for delivery to Egypt during the 2017/2018 marketing year
  • Export sales of 132,000 metric tons of soybeans for delivery to unknown destinations during the 2017/2018 marketing year
  • Export sales of 102,100 metric tons of corn for delivery to Mexico during the 2017/2018 marketing year

 
The marketing year for soybeans and corn began September 1.

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