Russia Aims to Lift Grain Prices
Russia is looking to purchase grain for domestic stocks to help lift prices.
Corn and soybeans are trading lower this morning with corn down 2 ¾ cents, soybeans down 9 ¾ cents and wheat trading 6 ¾ cents higher. Wheat continues its move higher as Russian policy aims at curbing exports.
Yesterday, NOPA crush numbers were released at 11 AM CST and came in on the low side of analyst expectation with 161.211 million bushels crushed in November. The average expectation for this report was 165.404 million bushels compared to last year’s November total of 160.145. Analysts ranged from 161 to 176 million bushels. It is important to note that near term demand has been the force lifting soybeans since the beginning of October. Today, more demand news is expected from Chicago as six major soybean buyers from China are expected to sign large purchases. With the first of two major demand stories behind us, soybeans may have a tough time maintaining strength into the end of the week.
Export inspections yesterday showed that Wheat outperformed analyst expectations with 385,974 metric tons inspected for export. Corn disappointed the market with only 546,515 metric tons inspected and soybeans met analyst expectations with 1,820,364 metric tons inspected for export.
This morning wheat prices continue to rise on news from the Russian Agriculture minister after he stated a plan to buy 3.5 million metric tons of grains for state stocks in an attempt to raise Russian grain prices. Yesterday, the slide in the ruble was the largest one-day fall since 1998 and triggered the Russian Central Bank to raise its key interest rate to 17 percent from 10.5 percent. The ruble hit a record low of 80 rubles per dollar.
NOPA Crush Numbers Disappoint
The NOPA crush numbers were released at 11 CST and came in below the average guess. Tune into GrainTV to see what else was moving the market.
Grains start the week in mostly positive territory
Wheat was fractionally lower in the overnight
Grains started the week in mostly positive territory with soybeans advancing 5 cents while corn was up 3. Wheat was fractionally lower in the night trade.
Corn was bolstered in the night session after Friday’s announcement by Syngenta that it was close to approval by China for its MIR 162 variety that has caused US corn trade to China to come to a standstill. The U.S. Grains Council said late Friday it hopes for confirmation of approval “in the coming days.” Although China has had limited imports of corn in recent years, if approved it would give the market a psychological lift.
In wheat, Russia’s ag minister reiterated overnight that the country has no plans to restrict its wheat exports. In Ukraine, the weather shows signs of a warming trend where cold weather has been the norm. Well-below normal temperatures have been in control across the Ukraine winter wheat region since the crop was planted back in September. Forecasts call for near to above normal temperatures through much of next week.
For soybeans, traders will be watching today’s monthly NOPA crush estimate. Industry analysts expect a large crush estimate, which is expected to show a record high of 165.4 MB for November. In South America, production prospects still look promising for a bumper crop. Although USDA left their soy crop estimate for South America unchanged in last week’s report, private analysts continue to predict higher production levels. In Brazil, rainfall across the region has been above normal over the past 30 days.
Grains Trade Higher to Close the Week
Wheat looks as though it will trade higher as the agricultural minister of Russia restrains exports. Tune in to hear Cody discuss FSA numbers as well as corn and soybean basis across the U.S.
Geo Grain Commentary
Weekly Cash Commentary
Higher futures prices and aggressive farmer selling helped keep soybean basis unchanged for the week, while US average corn basis rose 2 cents a bushel.
For soybeans, river terminals were hard hit this week slipping 5-cents a bushel as weakness at the Gulf combined with an uptick in barge rates pushed basis levels lower. For soybean plants, basis levels were mixed as some plants in the Eastern Cornbelt raised basis levels while some in the West lowered their basis. On average, soybean plants as a group were off 2 cents a bushel for the week.
In corn, river terminals were also hard hit by weakness at the Gulf and higher barge freight with basis levels 4 cents lower for the week. Ethanol buyers continue to bid aggressively for corn as spot ethanol prices continue to defy the steep sell off in crude prices. Crush margins for ethanol producers continue to be favorable and this week’s production figure of 988,000 barrels per day was a marketing year high and putting year-to-date production 4.6% above last year’s tally. Basis levels for ethanol buyers were up 2 cents on average, although some plants were lower on the week thanks to increased farmer selling.
Grains extended their gains in the overnight session
Wheat, Corn and Soybeans were up at the end of the night trade
Grains extended their gains in the overnight session with front-month March wheat futures climbing above $6 a bushel but hitting resistance at $6.10. Corn and soybeans were also up posting 5 cent advances at the end of the night trade.
On Thursday, Egypt’s GASC announced the results of their wheat tender with Russia garnering most of the business. Prices came in around $252 per MT and were $30 lower than the only US SRTW wheat offer. Nonetheless, US interior values continue to be robust. Millers in Illinois continue to bid aggressively for wheat with basis levels for spot delivery about 50 cents a bushel higher than normal for this time of year.
For soybeans, the market continues to be buoyed by strong export demand. Current export commitments for US soybeans have eclipsed 40 MMT while USDA has pegged total exports for the year to reach 47.9 MMT. Traders also look for a large crush estimate in Monday’s monthly NOPA release, which is expected to show a record high of 165.4 MB for November.
In corn, export business was on par with expectations last week, but overall commitments year-to-date are on par with the pace needed to reach USDA’s annual forecast. Ukraine is said to be having problems meeting corn contracts signed with China in. Private feed mills in China signed contracts in October to 1.1 MMT but the Ukraine supplier is unlikely to be able to ship all of the contracted volume before the February deadline.
Strong Export Sales
Tune into GrainTV and see Cody break down the export sales reported this morning and see if corn and soybean export sales pace is strong enough to meet the USDA's expectations.
WASDE Out Today
Tune into a packed GrainTV as Cody discusses why there was selling pressure after the WASDE report. He also hits on recent news about South American exports and ethanol numbers.
Will we see new highs in tomorrow’s trade?
Cody discusses WASDE expectations and what that could mean for the market. He also looks at what to expect from South American crop production.
Grains Mixed on Friday with Traders Eyeing Tuesday’s Reports
In the overnight session the grains were mixed with corn down 3/4 of a cent, soybeans down 2 3/4 of a cent and wheat up 4 cents going into this morning’s pause. Traders are eyeing two market moving reports that will be released next Tuesday the 31st which include the planting intentions...[Read More]
Missed Export Sales Expectations
Will this week’s soybean sales lift the market?
In the overnight session corn fell 3/4 of a cent, soybeans dropped 2 3/4 cents and wheat increased 1 1/2 cents. The dollar pulled back one third of a percent and crude oil is trading up a dollar this morning. This morning there was a reportable sale of 280,000 metric tons of soybeans to...[Read More]
How many acres will be planted to Soybeans?
The overnight was a quiet trade with corn unchanged, soybeans up 1/4 cent and wheat down 3 1/4 cents. The dollar is trading lower by nearly 3/4 of a percent and crude oil is up 34 cents. This morning there were a couple reportable sales that were announced by FAS for 108,863 metric tons of...[Read More]