Afternoon Market Recap for April 21, 2021

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Soybeans race toward $15 per bushel.

Corn and wheat prices also trend significantly higher Wednesday

Grain prices surged higher again on Wednesday, fueled by another round of technical buying spurred by this week’s cold snap, which brought rain, snow and the prospects of widespread planting delays in its wake. Nearby corn prices jumped another 3% higher, while soybeans climbed 1.75% higher and nearly closed above $15 per bushel – a feat not seen since the spring of 2014. Wheat prices also enjoyed healthy gains of around 1.5% to 2% today.

The Midwest and Plains have already seen some rain and snow this week, and most of the region will get some additional measurable moisture between Thursday and Sunday, per the latest 72-hour cumulative precipitation map from NOAA. Most areas will see less than 0.25” during this time, however. The agency’s 8-to-14-day outlook predicts more seasonally wet weather east of the Mississippi River between April 28 and May 4, with a small pocket of colder-than-normal temperatures centered around Missouri and Iowa.

On Wall St., the Dow rebounded 262 points higher to 34,083 on strong travel stocks and mostly positive quarterly corporate earnings reports that have dropped so far this week. Energy prices eroded significantly, with crude oil down more than 2% to fall back below $62 per barrel based largely on higher U.S. stocks and lower demand in coronavirus-stricken India. Gasoline and diesel were also down around 2% this afternoon. The U.S. Dollar softened slightly.

On Tuesday, commodity funds were net buyers of all major grain contracts, including corn (+35,000), soybeans (+12,000), soymeal (+3,500), soyoil (+7,500) and CBOT wheat (+6,000).

Corn

Corn prices rocketed ahead again on Wednesday, as traders remained focused on the inclement weather that moved through the Corn Belt earlier this week, with more wet, colder-than-normal weather in the forecasts. That will create widespread planting delays for a crop that’s already getting in the ground a bit slower than expected. May futures rose 18.25 cents to $6.2475, with July futures up 13.75 cents to $6.0575.

Corn basis bids held steady across most Midwestern locations Wednesday but did tilt a penny higher at an Illinois river terminal and 6 cents higher at an Illinois ethanol plant today.

Ahead of the next export report from USDA, out Thursday morning, analysts expect the agency to show corn sales ranging between 13.8 million and 43.3 million bushels for the week ending April 15, offering fair confidence that week-over-week sales will improve from the prior tally of 15.0 million bushels.

The latest data from the U.S. Energy Information Administration showed a steady rate of ethanol production for the week ending April 16, with a daily average of 941,000 barrels – identical to a week ago. Year-over-year production jumped 67% higher this past week as demand continues to improve from pandemic-related lockdowns last year. Ethanol stocks are also down 26% year-over-year, falling to its current level of 20.447 million barrels.

Brazil’s second corn crop is experiencing some quality concerns, especially in the No. 2 production state of Parana. Through April 19, 62% of Parana’s second corn crop was in good condition, tumbling 14 points lower from a week ago. The area is experiencing one of the driest Aprils over the past two decades.

Ukraine’s corn exports for the 2020/21 marketing year are at 712.6 million bushels, according to the country’s agriculture ministry. Ukraine is one of the world’s largest grain exporters.

Grain traveling the nation’s railways jumped to a total volume of 26,236 carloads last week. Year-to-date totals for 2021 are now at 379,720 carloads, a 24.5% year-over-year increase so far.

Preliminary volume estimates were for 455,703 contracts, trending slightly higher than Tuesday’s final count of 438,205.

Soybeans

Soybean prices moved around 1.75% higher on another weather-related round of technical buying Wednesday. Tightening domestic supplies has also lent support in recent sessions. Today, May futures climbed 26.25 cents to $14.9825, with July futures up 22.25 cents to $14.80.

Soybean basis bids rose 5 cents higher at two Indiana processors while holding steady elsewhere across the central U.S. today.

Ahead of tomorrow morning’s export report from USDA, analysts expect the agency to show soybean sales ranging between 5.5 million and 27.6 million bushels for the week ending April 15. Analysts also anticipate soymeal sales ranging between 50,000 and 250,00 metric tons last week, plus soyoil sales ranging between a reduction of 5,000 MT and a net gain of 20,000 MT.

China’s agriculture ministry has published new guidelines on pig and poultry feed that include recommendations to reduce corn and soymeal, which have become very costly to local users in recent months. A bevy of alternatives were suggested, including wheat, barley, sorghum, cottonseed meal, distillers dried grains and more.

Looking for more insights into U.S.-China trade relations? A former ag trade negotiator, Gregg Doud, will be among the featured speakers at the 2021 Farm Futures Business Summit, set to take place live at the Coralville Marriott Hotel and Conference Center near Iowa City on June 16-17. Click here to learn more about this event and how to register.

Preliminary volume estimates were for 259,691 contracts, inching slightly below Tuesday’s final count of 261,354.

Wheat

Wheat prices rose 1.5% to 2% higher on a round of technical buying spurred by frosts in the U.S. Plains and Midwest, along with tension over a Russian military buildup near the Ukrainian border. May Chicago SRW futures gained 14.75 cents to $6.7350, May Kansas City HRW futures added 9.5 cents to $6.3025, and May MGEX spring wheat futures picked up 9.75 cents to $6.7875.

Ahead of Thursday morning’s export report from USDA, analysts anticipate wheat sales ranging between 7.3 million and 25.7 million bushels for the week ending April 15, offering some confidence that actuals will best the prior week’s tepid results of 8.0 million bushels.

The Buenos Aires Grains Exchange expects Argentinian farmers to plant 16.062 million acres of wheat for the 2021/22 season, holding plantings steady from a year ago. Planting season begins in May.

Ukraine’s wheat exports for the 2020/21 marketing year are at 540.1 million bushels, which represents 85% of the total wheat export quota that was imposed this season. Total grain exports are down about 23% year-over-year so far.

Preliminary volume estimates were for 135,075 CBOT contracts, which was 13% below Tuesday’s final count of 154,835.

Closing Prices for Key Commodities 
  High Low Last Change
Corn                     $/bushel  cents/bu    
21-May 628.5 604.5 625.5 18.25
21-Jul 609.5 588.25 606.5 13.75
Soybeans        
21-May 1499.75 1467.5 1497.25 26.25
21-Jul 1481.75 1453 1479.5 22.25
Soymeal                $/ton        
21-Jul 417.3 411.1 416.1 1.8
Soyoil                    cents/lb        
21-Jul 57.17 55.1 56.94 1.77
Wheat                    $/bushel        
21-May 678.75 658.75 673.25 13.75
21-Jul 680 660.5 675 14
KC Wheat        
21-May 636.5 618.5 630.75 9.5
21-Jul 643.5 625.5 637.75 9.75
MPLS Wheat        
21-May 682 668 678.5 9.75
21-Jul 688.75 674 685.25 10.25
Live Cattle             cents/lb        
21-Apr 120.775 119.15 119.7 -0.875
Feeder Cattle         cents/lb        
21-May 143.2 138.725 139.675 -3.1
Lean Hogs             cents/lb        
21-Jun 106.75 103.65 104.4 -1.95
Crude Oil  $/barrel *Energy prices may not represent final settlements      
21-May 62.56 60.86 61.19 -1.48
Diesel        
21-May 1.8764 1.8382 1.849 -0.0311
Unleaded Gasoline   $/gallon        
21-May 2.018 1.9691 1.974 -0.0434
Natural Gas        
21-Jun 2.803 2.746 2.778 -0.025
Ethanol Futures        
21-May 2.199 2.199 2.199 0.039
U.S. Dollar Index        
21-Jun 91.425 91.065 91.13 -0.097
Gold                      $/ounce        
21-May 1797.7 1776 1793.5 16.2
Copper        
21-Apr 4.286 4.2525 4.286 0.062
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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