Corn Continues Sideways
- December 2022 CBOT corn futures shed 5-1/2 cents this week to close at 684-1/4
- July of 2023 CBOT corn futures shed 7-1/4 cents this week to close at 683-1/2
- Corn futures continue to remain in a 40-cent range here just below the $7-mark; harvest pressure and poor exports have yet to push prices out of this range
- The Biden administration announced this week their plan to refill the Strategic Petroleum Reserves when crude oil prices drop to around $70 per barrel
- Cumulative corn export sales have reached 25.3% of the USDA forecast for the 2022/2023 marketing year versus a 5-year average of 35.5%.
- The International Grains Council, world corn ending stocks in the 2022-23 season are now seen at 258 million tons, vs a September estimate of 262 million tons
Soybeans Slightly Higher this Week
- November of 2022 CBOT soybean futures added 11-3/4 cents this week to close at 1395-1/2
- July of 2023 CBOT soybean futures added 9-1/2 cents this week to close at 1422-1/2
- 22% of Brazil’s soybeans have been planted, only slightly behind last year’s pace of 24%, but well ahead of the five-year average of 15%
- Although early Brazilian weather looks rather favorable for crop production, heavy rains in the first half of October have eased drought concerns for many
- China appears to be back in buying mode for US soybeans, purchases this week were the largest sales figure since last year totaling over 2.3 million tons
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Wheat Prices Mixed for the Week
- December CBOT wheat futures shed 9 cents this week to close at 850-3/4
- December KCBOT wheat futures shed 4 cents this week to close at 952-1/4
- December MGEX wheat futures added 7-1/4 cents this week to close at 961-1/2
- The possibility of significant rains for the US Plains put pressure on the wheat markets this week; the Plains are in dire need of precipitation to rebuild soil moisture levels
- The status of the Ukraine export deal with Russia, as well as US Plains, rainfall will dictate the near-term trend in wheat
- Wetter than normal weather over the coming weeks for the northern Plains should help recharge soil moisture levels ahead of next spring’s wheat planting
Deferred Contracts Weaken
While the November Class III contract closed the week 63 cents higher within a volatile $1.48 range, the December contract and all 2023 contracts were lower on the week. The Q1 Class III average has fallen about $1.17 in the last two weeks, while the Q2 average fell around 90 cents in that time. Class IV action was similar with the November contract finishing up 26 cents from last Friday’s close, but most deferred months gave up value. The two fundamental reports released this week, Tuesday’s GDT Auction and yesterday’s Milk Production report, were both seen as bearish. Overall, market action has been mostly rangebound in recent weeks for both the nearby dairy and feed markets, with the exception of spot powder’s break down.
Author
Keegan Madigan