Corn closes up 25¢, soybeans end 70¢ higher | Wednesday, March 31, 2021

Daily limits will be raised for Thursday.

On Wednesday, the CME Group’s farm markets react very bullish toward this morning’s USDA data dump.

At the close, the May corn futures settled up its daily limit of 25¢ at $5.64½. July corn futures settled up its daily limit of 25¢ higher at $5.47½. New-crop December corn futures closed up its daily limit of 25¢ at $4.77½.

As a result, corn’s daily trade limits will expand to 40¢ tomorrow.
May soybean futures finished up its daily limit of 70¢ at $14.36½. July soybean futures ended up its daily limit of 70¢ higher at $14.27½. New-crop November soybean futures settled up its daily limit of 70¢ at $12.56¾.

May wheat futures closed 16¢ higher at $6.18. 

May soymeal futures settled $25.00 short term higher at $423.20.

May soy oil futures closed 2.46¢ higher at 52.92¢ per pound.

In the outside markets, the NYMEX crude oil market is -1.33 lower (-2.20%) at $59.22. The U.S. dollar is lower, and the Dow Jones Industrials are 42 points higher (+0.13%) at 33,109 points.

Bob Linneman, Kluis Advisors, says that the trade may be anticipating bearish USDA numbers today.  

“Corn and soybean futures slipped under key moving averages on Tuesday, which could have added to the selling pressure. Prices have slipped a reasonable amount from the recent highs. Is this slide anticipating bearish numbers from the USDA today? Have traders already discounted for some negative news that we may see today?” Linneman comments in a daily note to customers. 

Linneman adds, “If the report today is within range of prereport estimates, will prices rebound? The cash markets are still strong as we continue to see basis tighten in many areas across the Midwest.”

On Wednesday, the Energy Information Administration (EIA) released its weekly U.S. ethanol production.

According to EIA data analyzed by the Renewable Fuels Association for the week ending March 26, ethanol production rebounded 4.7%, or 43,000 barrels per day (b/d), to 965,000 b/d, equivalent to 40.53 million gallons daily. Production was 14.9% above the same week last year, when output started falling sharply due to the pandemic, but was 3.4% below the same week in 2019. The four-week average ethanol production rate increased 3.2% to 949,000 b/d, equivalent to an annualized rate of 14.55 billion gallons (bg), according to the Renewable Fuels Association’s press release.

Ethanol stocks contracted 3.2% to an 18-week low of 21.1 million barrels, which was 17.9% below a year ago and 12.0% below this time in 2019. Inventories dropped across all regions.

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