Grain basis moved higher this week with soybeans advancing 1.5 cents a bushel on average across the US while corn basis was up a modest 0.8 cents a bushel.
The steep slide in soybean prices at the end of last week helped fuel some minor basis improvements with soy crush facilities seeing gains of 2.8 cents a bushel on average. River terminals, however, saw some minor weakness on the week as average soy basis dipped 0.5 cents a bushel. Of note this past week there was a fairly noticeable response to USDA’s big soy acreage jump as 20% of the grain buyers in GeoGrain’s system of over 4,300 buyers lowered their new-crop soybean bids over the past week.
For corn, spot basis did improve on average by 1.3 cents at ethanol plants but continues to run well below average for this time of year. Like soybeans, river terminals were mostly flat over the last week.
With First Notice Day on May futures 3 weeks away, it seems that soybean basis along key delivery points has a long way to go to push convergence to futures. Average basis along delivery points is about -25K suggesting quite a move will be needed to get the spot basis to par in the next few weeks. For corn, the delivery locations are running at about -8K with upside to par expected in the next 3 weeks.
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