Blog Archives
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Grain Basis Slips
By Cody Bills - Monday May 6, 2013
Cash grain markets felt pressure this week from river flooding and the inverse carry in the futures market. For the week, US average corn basis slipped 3 cents a bushel while average spot soybean basis was off 2 cents a bushel. Flooding along the Illinois River left many grain elevators shut down at the beginning of the week which caused bids to ease in these areas. However, the Ohio river was largely unaffected so basis levels from Southern Ohio to Southern Illinois found some strength. At the Gulf export market, corn basis was up 4 cents a bushel as limited supplies were able to move to the Gulf. For ethanol plants, average corn basis was off 3 cents a bushel with Eastern Cornbelt plants showing more weakness this week than Western... -
Corn Basis Finds Strength From Ethanol
By Cody Bills - Monday May 6, 2013
Both corn and soybean basis levels found strength this week as tight farmer selling and the prospects of a late harvest next fall push basis levels up. Spot corn basis was up 2 cents a bushel while soybean basis climbed nearly 4 cents a bushel for the week. In corn, basis levels at ethanol plants were a key driver this week as 10 to 15 cent gains were fairly typical across NE, SD & IA this week. In addition, shipping along the flooded IL river last week seemed to ease this week which lifted river terminal basis levels by a dime or more at key terminals. For soybeans, export business continues to slow which pushed basis levels down at most river facilities over the past week. On average, river terminals were off 3 cents a bushel. At... -
Basis Along River Ticks Lower
- Tuesday March 19, 2013
Average soybean basis across the US was down 1 cent on account of declining river markets, while corn basis remained unchanged on the week. Soybean plants gained one cent on the week but weakness along the river pulled basis lower throughout the country. Soybean basis at the gulf dropped 3 cents which negatively impacted terminals along the river. Terminals along the Ohio River were affected most and declined by an average of 4 cents since last Thursday. This week’s average U.S corn basis remained unchanged despite the gulf moving 2 cents lower and the rest of the river declining by an average of ¾ of a cent. The rally in the futures market since last Thursdays lows helped improve farm selling and capped basis from advancing... -
Corn and Soybean Basis Stalls
By Cody Bills - Sunday March 10, 2013
Corn and bean basis were stagnate this week showing no change on average across the country over the past week. At the Gulf, corn basis found modest strength of 4 cents a bushel but river terminals along the river were mixed. Areas south of St Louis have seen basis retreat while areas along the Mississippi river in Iowa and Illinois saw some limited positive gains. In the ethanol market, basis levels were unchanged on average although some buyers were noticeably weaker as basis levels fell 5 to 10 cents on the week. For soybeans, river markets showed large variability with some terminals increasing basis 10 cents or more while others dropped by a similar amount. Strong export demand keeps underpinning river basis, but a negative carry... -
Bean Basis Softens on Price Rally
By Cody Bills - Monday February 25, 2013
Soybean basis lost one-cent a bushel on average across the country this week, while corn basis managed to post a modest one-cent gain for the week. Gains in corn basis were most notably tied to ethanol plants, which saw a 2-cent gain over the last week. Ethanol margins continue to improve off their lows from the start of the year as ethanol prices have firmed and corn prices have eased off. At the Gulf, corn basis was unchanged and limited changes occurred along river terminals as barge rates were mostly stable. For beans, basis levels were off 1-cent a bushel across the country this week. Soybean crushing plants were lower by 2-cents a bushel, while some processors in the Eastern Cornbelt were off 5 to 10-cents on the week. River... -
Weakening Gulf Basis Weighs on Soybeans
By Cody Bills - Friday February 1, 2013
Corn and soybean basis moved in opposite directions this week as farm soybean sales picked up and weakening Gulf bids pushed basis lower. For the week, corn basis was up 2 cents a bushel while soybean basis lost 2 cents a bushel. For corn, basis levels were firmer by 3 cents a bushel at ethanol plants as margin levels for processing corn to ethanol improved the past week for the first time in about a month. Nonetheless, margins continue to be tight and about 6 plants have idled production in the past few weeks. At the Gulf, export basis levels were up 4 cents on the week and river terminals posted a 3-cent advance In soybeans, basis weakness was widespread across much of the country with the exception being Eastern Cornbelt regions... -
Basis Levels Stagnant on Futures Rally
By Cody Bills - Sunday January 20, 2013
Both corn and soybean basis levels saw limited movement this week, as futures markets climbed on renewed concerns about short supplies. For the week, U.S. average corn and soybean basis were unchanged. In the corn market, higher than expected feed use reported in last week’s USDA report cut the old-crop ending stocks forecast below trade estimates. But, continued lack of business in the export market and ethanol sector has kept basis levels stable to weaker. For the week, ethanol plants lowered their basis by 1-cent a bushel. On Wednesday, EIA showed ethanol production took a hit for the week as production averaged 784,000 bushels per day, the lowest level since the agency started releasing weekly data in June 2010. Grain Hedge still... -
Soybean Basis Jumps while Corn Stays Sluggish
By Cody Bills - Thursday January 10, 2013
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... -
Basis Levels Inch Higher
By Cody Bills - Friday December 21, 2012
Basis levels were up modestly this week with sluggish demand keeping cash markets mostly quiet. On average across the U.S., spot corn basis managed a one cent gain for the week while spot beans were up 2 cents. In the corn market, ongoing demand struggles for exports and ethanol has kept basis levels mostly stable. While December is a time of usually increasing basis levels, for this year December has seen only a modest 2 cent improvement in US average basis. Weak export conditions have taken its toll on the Gulf where basis levels backed off 6 cents for the week. In the ethanol market, EIA’s weekly ethanol report showed production was down 2,000 barrels per day from last week and stocks of ethanol were sharply higher. Even with... -
Soy Basis Surges on Demand Strength
By Cody Bills - Wednesday December 19, 2012
U.S. average soybean basis levels were up 4 cents a bushel for the week, bolstered by a strong crush and export sector. The soybean basis strength was greatest around the river system especially southern reaches of the Mississippi river and the Ohio river. River markets on average gained 7 cents a bushel on basis for the week, helped by a 5-cent gain at the Gulf where exports are robust. This week’s export sales report showed a marketing year high of 1.3 MMT of business for soybeans, with 1.0 MMT going to China. Also buoying the bean market is strong domestic crush. NOPA’s monthly crush estimate of 157.3 mb for November is the biggest November crush since 2009 and the biggest monthly figure overall since January 2010. Domestic crush...
