January 08, 2013 | Grain Hedge Insights | Jackie Roembke | Views: 212

Soybean Basis Jumps while Corn Stays Sluggish

Soybean basis saw double-digit gains in many parts of the country, while lackluster export demand kept corn basis improvements modest

Soybean basis saw double-digit gains in many parts of the country this week as strong export bids and falling barge freight helped push basis levels higher. For the week, U.S. average soybean basis was up 4 cents a bushel while corn

Spot soybeans rose sharply on the river system this week, bolstered by a decline in shipping costs to the lowest levels since before the autumn harvest. An adequate supply of empty vessels on U.S. Midwest rivers pressured barge freight, with shipping costs on the Illinois River falling to the cheapest since August.  Gulf premiums also rose by 10 cents a bushel . On average, river terminals were up 12 cents a bushel for the week while soybean crushing plants lagged behind with a 4-cent advance.

In corn, lack of strong export business continues to plague the market. This week’s paltry sales of only 49,000 MT underscores just how bad the corn export picture really is.  Total year-to-date export sales of corn are 48% below last year, while USDA has pegged exports to fall only 25%.  In the cash markets, corn basis was up modestly across the country thanks to a 6-cent gain at the Gulf. However, ethanol plants continue to show spotty needs. Some plants in ND and MN drove basis higher to start the New Year while plants in IA were mostly weaker. On average, ethanol plants were up 2.5 cents for the week.

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GeoGrain Weekly Comments

November 21, 2014 | Grain Hedge Insights | Cody Bills

Cash grain markets found strength as futures prices were down on the week. Both spot and corn bean basis levels posted impressive gains, advancing 5 and 3 cents a bushel, respectively, on the week.

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November 21, 2014 | Grain Hedge Insights | Cody Bills

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November 20, 2014 | Grain Hedge Insights | Cody Bills

In the overnight session corn increased 2 ¼ cents, soybeans increased 1 ¾ cents and wheat fell 3 cents as we go into the morning pause in trade. Export sales which were released at 7:30 CST caused soybeans to give back most of the gains it had achieved in an overnight bounce.

 

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