Afternoon Market Recap for April 20, 2021

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Let it snow (it’s good for grain prices).

Dismal weather heats up corn, soybean and wheat prices Tuesday

Snow is a welcome wintertime sight for many, but farmers itching to get acres planted don’t need this kind of weather in late April. Fieldwork may be stalled, but the big silver lining is grain prices shot up significantly higher Tuesday. Corn prices gained more than 2%, closing at multiyear highs above $6 per bushel. Nearby soybean contracts are also getting tantalizingly close to $15 pe bushel after rising another 1.5% higher today, with wheat contracts picking up between 1% and 1.5%.

Later today, a band of rain and snow will make its way across the eastern Corn Belt – a relatively unusual occurrence for this time of year. Most of the central U.S. will see additional light amounts of moisture between Wednesday and Saturday, per the latest 72-hour cumulative precipitation map from NOAA. The agency’s 8-to-14-day outlook predicts seasonally cool weather will hang on in the upper Midwest and Great Lakes region between April 27 and May 3, with wetter-than-normal conditions likely for much of the country during this time.

On Wall St., the Dow tumbled 355 points lower in afternoon trading to 33,720 after skittish investors worried about economic recovery amid a global rise in coronavirus cases. Some solid corporate earnings reports didn’t move the needle, having already been priced into the market. Energy prices also shifted lower, with crude oil dropping 1.25% this afternoon to move back below $63 per barrel. Gasoline dropped nearly 1.5%, with diesel down around 1%. The U.S. Dollar firmed moderately.

On Monday, commodity funds were net buyers of corn (+12,500), soybeans (+7,500) and soymeal (+4,500) contracts but were net sellers of soyoil (-1,000) and CBOT wheat (-500).

Get ready for an upcoming opportunity to sharpen your grain marketing skills and meet with peers as we return live for the 2021 Farm Futures Business Summit, set for June 16-17 at the Coralville Marriott Hotel and Conference Center just outside Iowa City. Click here to learn more about the event and find out how to register!

Corn

Corn prices jumped significantly higher on a round of technical buying largely spurred by wintery weather moving its way across the Midwest that should dramatically slow the pace of planting in many areas this week. May futures rose 15.75 cents to $6.0775, with July futures up 12.25 cents to $5.9275.

Corn basis bids were largely steady across the central U.S. Tuesday but did tilt 3 cents higher at a Nebraska elevator today.

This morning, private exporters reported to USDA the sale of 4.5 million bushels of corn for delivery to Mexico during the 2020/21 marketing year, which began September 1.

USDA reported Monday afternoon that corn planting progress has reached 8% through April 18, which was up from the prior week’s tally of 4% but a point below the average trade guess of 9%. Seven of the top 18 production states have at least made double-digit progress so far, led by Texas (60%). Emergence is at 2%.

Preliminary volume estimates were for 438,205 contracts, which nearly doubled Monday’s final count of 233,009.

Soybeans

Soybean prices followed corn higher as wintery weather put a stop to fieldwork in many areas, which triggered a round of technical buying that pushed prices another 1.5% higher today. May futures climbed 23 cents to $14.7275, while July futures rose 21.75 cents to $14.5825.

Soybean basis bids were steady to firm Tuesday as some users attempted to shore up tight supplies. Bids moved 1 to 7 cents higher across five Midwestern locations today.

USDA reported Monday afternoon that 3% of the crop has been planted through Sunday, which is in line with analyst expectations and ahead of the prior five-year average of 2%. Mississippi (15%), Arkansas (12%) and Louisiana (10%) have made the most progress among the top 18 production states so far.

Rain and snow won’t keep postal workers from completing their routes, but bad weather will keep farmers out of the field. And we saw plenty evidence of that in our first Feedback From The Fields update of 2021. “Colder than normal weather lately with about an inch of moisture coming as wet snow and light rain leading into the weekend will push planting back another 5 days at least,” one farmer noted. “Don't expect to see much corn or bean acreage planted before April 25th.” Click here to read more farmer anecdotes and view our interactive map.

One year ago, nearby soybean contracts were languishing around $8 per bushel. Fast forward 365 days and they are above $14.50 per bushel with a chance to clear $15 later this spring. Grain market analyst takes a look back at how the rally unfolded and what to watch for next in the latest Ag Marketing IQ blog – click here to learn more.

Preliminary volume estimates were for 261,361 contracts, trending moderately above Monday’s final count of 197,088.

Wheat

Wheat prices added between 1% and 1.5% today after a round of technical buying partly supported by spillover strength from corn and soybeans, along with widespread weather disruptions this week. May Chicago SRW futures gained 6.75 cents to $6.59, May Kansas City HRW futures rose 9.25 cents to $6.2125, and May MGEX spring wheat futures added 7 cents to $6.7150.

Spring wheat planting progress moved from 11% a week ago up to 19%, besting the average trade guess of 17% and moving further ahead of the prior five-year average of 12%. Washington leads the pack among the top six production states, with 71% completion, followed by South Dakota (46%) and Idaho (46%).

For winter wheat, 10% of the 2020/21 crop is headed. That’s up from 5% a week ago but below the prior five-year average of 14%. Only seven of the top 18 production states have made measurable forays into this category so far, led by Texas (41%).

Quality ratings for winter wheat held steady, with 53% of the crop rated in good-to-excellent condition. Analysts expected USDA to dock quality a point, in contrast. Another 30% was rated fair, with the remaining 17% rated poor or very poor – all unchanged from last week.

Statistics Canada is et to release its crop planting intentions report next Tuesday morning. Ahead of that report, analysts expect the agency to show all wheat plantings at 23.7 million acres, down more than a million acres from last year, if realized. Some of those acres will go into increased plantings of corn, barley and canola, according to the batch of trade guesses.

Russian wheat exports reached 278.9 million bushels in January and February, per the latest customs data. That’s more than double year-over-year results of 136.0 million bushels during the first two months of 2020. Russia is the world’s No. 1 wheat exporter.

Japan is looking to purchase 3.1 million bushels of food-quality wheat from the United States and Canada in a regular tender that closes later this week. Of the total, 70% is expected to be sourced from the U.S.

Preliminary volume estimates were for 154,935 CBOT contracts, tracking moderately higher than Monday’s final count of 91,850.

Closing Prices for Key Commodities 
  High Low Last Change
Corn                     $/bushel  cents/bu    
21-May 611.75 592.75 606.5 15.75
21-Jul 597.5 580.75 592 12.25
Soybeans        
21-May 1485.5 1450 1472 23
21-Jul 1471.5 1435.75 1457.75 21.75
Soymeal                $/ton        
21-Jul 419.6 410.8 414.7 3.4
Soyoil                    cents/lb        
21-Jul 55.79 53.68 55.14 1.25
Wheat                    $/bushel        
21-May 679 650.25 659.75 6.75
21-Jul 679.5 651.25 661.25 7
KC Wheat        
21-May 635.75 609.25 620.75 9.25
21-Jul 642.5 615.75 628 9.5
MPLS Wheat        
21-May 682.75 662.5 669 7
21-Jul 689.75 669.5 676 7
Live Cattle             cents/lb        
21-Apr 121.075 119.75 120.6 0.25
Feeder Cattle         cents/lb        
21-May 143.55 139.9 142.675 0.2
Lean Hogs             cents/lb        
21-Jun 106.4 104.775 106.35 2.025
Crude Oil  $/barrel *Energy prices may not represent final settlements      
21-May 64.25 61.5 62.61 -0.77
Diesel        
21-May 1.9155 1.8483 1.8761 -0.0164
Unleaded Gasoline   $/gallon        
21-May 2.072 1.9895 2.016 -0.0285
Natural Gas        
21-Jun 2.83 2.793 2.808 -0.01
Ethanol Futures        
21-Jun     2.16  
U.S. Dollar Index        
21-Jun 91.27 90.84 91.23 0.18
Gold                      $/ounce        
21-May 1779.2 1763 1776.3 6.9
Copper        
21-Apr 4.2695 4.2245 4.2245 -0.0255
Fertilizer Swaps     (as of 04/16)  
DAP Tampa-index              595.0 10
DAP-New Orleans              596.9 -7
Urea-New Orleans              407.3 -20
Urea-Middle East              342.5 -28
Urea-Black Sea              330.0 -3
UAN (32%) New Orleans              322.4 -1.1
 
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