This Week in Commodities 09-16-2022

Corn Lower on the Week

  • December CBOT corn futures shed 7-3/4 cents this week to close at 677-1/4
  • July 2023 CBOT corn futures shed 6 cents this week to close at 677-1/2
  • U.S. railroads and unions reached a tentative agreement this week narrowly avoiding a strike, the agreement included a 24% wage increase over five years, as well as a 14.1% raise effective immediately
  • The CPC is calling for above normal temperatures and below normal precipitation over the next 30 days, this should help harvest to roll along in the coming weeks
  • Four weeks of USDA weekly export data was dumped on the market this week, corn sales are well behind the previous two years, less buying this year than last from China is the main driver of the year-over-year decline
  • US gasoline demand slumped lower yet again this week trending down to a 25-year low for the date, this should slow usually strong ethanol production around harvest time here in the US


Soybeans Higher this Week Following Monday’s Gains

  • New crop November CBOT soybean futures added 36-1/4 cents this week to close at 1448-1/2
  • July of 2023 CBOT soybean futures added 33 cents this week to close at 1454-1/4
  • November soybeans gave back about half of their Monday gains to round out the week remaining in its sideway range that dates back to early August
  • Farmers in the southern Brazilian state of Parana have started to plant their 2022/23 soybean acres, the state is expected to produce between 21.5 and 22 million tons of soybeans this year, up from just 12 million tons last year due to drought
  • NOPA US crush in the month of August totaled 165.5 million bushels, below the average trade guess, however, total crush over the last twelve months is still running three percent higher than the same period last year
  • Continued recession threats, a downward trend in crude oil, and harvest pressure fresh on the horizon will all be strong headwinds for the soybean market in the weeks to come

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Wheat Mixed this Week

  • December CBOT wheat futures shed 9-3/4 cents this week to close at 859-3/4
  • December KCBOT wheat futures added 6 cents this week to close at 935-1/4
  • December MGEX wheat futures added 11-1/4 cents this week to close at 938-3/4
  • After trading sideways last week, the US dollar index surged higher again this week closing into yet another new high for its recent trend higher
  • Dryness in the US plains continues to be a concern as winter wheat planting is just getting underway, this helped move KC wheat futures higher this week
  • Spring wheat traded near the top, but remains in its sideways range between 850 and 950 on a continuous chart with harvest now nearing completion


Mixed Week for Dairy

October Class III futures, the block/barrel average, and spot whey all closed higher on the week. The action was volatile with October futures putting in its weekly high of $22.05 on Tuesday before breaking hard, then bouncing off a Friday morning low of $20.78. Class IV futures finished the week two-sided but avoided any major moves, while spot butter came under selling after closing at $3.24/lb on Tuesday, a new all-time high. Many commodities felt the weight of a worse-than-expected CPI report on Tuesday which caused a dollar index rally, and some concern is warranted given the bearish cheese production/supply and the fact that spot butter’s move above $3.00/lb could lead to some demand destruction. Next week, August Milk Production is released Monday, a GDT Auction takes place Tuesday, and August Cold Storage will come out Thursday.


Keegan Madigan

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