Grain basis was mostly steady this week in spite of wide swings in the underlying futures market. On the week, US average corn and soybean basis were unchanged.
Corn basis continues to show more strength in the Western and Northern Plains as dry conditions and heavy cattle feeding activity continues to underpin the market. In North Dakota, ethanol plants there raised their basis 3 to 9 cents a bushel over the last week. But other plants around the country were more stable, and stretching into the Eastern Cornbelt there was some modest weakness. River terminals as a group were off 2 cents a bushel with the Gulf bid giving up 1 cent on the week.
In soybeans, basis levels were 2-cents weaker at crushing plants and 4-cents weaker at river terminals. There was some modest improvement in bean basis in the Central and Northern Plains on the week.
Weather in recent weeks has spelled some problems for corn yield in certain regions of the country. Private forecaster Planalytics, utilizing satellite imagery data, has pegged the US corn yield at 165.3 bushels per acre, which is 3 bushel an acre below their trend yield forecast. The worse state is SD where they are at 24 bushels below trend. So far, there has been only modest movement in New-Crop 2017 corn basis with the last 30 days seeing modest gains in the Western Plains of OK/KS/NE. If yield continues to be subpar pin these areas and with strong cattle feeding, we would expect basis levels in the WCB to start to respond higher.
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