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Afternoon Market Recap for Feb. 15, 2019

Grain markets close Friday with mixed results.

Traders engage in some light technical maneuvering ahead of a long weekend

Ahead of the three-day holiday weekend, grain markets dialed in mostly minor changes that left commodity prices mixed Friday. Nearby corn futures were left unchanged in the session, as soybeans gained some small momentum on U.S.-China trade optimism, while wheat continued to slide lower on more technical selling.

Sharply colder-than-average temperatures are expected across much of the central U.S. this weekend into earlier next week. The biggest drops are expected across the Plains. Some light rain and snow is expected to reach the Midwest and Plains over the next week, according to the latest seven-day cumulative precipitation map from NOAA, with parts of the Midsouth and Southeast expecting more moderate accumulations through February 22.

U.S.-China trade optimism led stocks higher on Wall St. Friday, despite the uncertainty surrounding President Donald Trump’s decision to declare a national emergency this morning in an attempt to collect additional border wall funding. The Dow picked up another 350 points in afternoon trading to 25,795. The Dow is almost certain to wrap up an eighth straight week of gains when today’s session draws to a close later this afternoon.

Energy futures also moved significantly higher Friday, with crude oil up nearly 2% in afternoon trading to move back over $55 per barrel. Gasoline was up more than 4%, meantime, with diesel gaining more than 2% this afternoon. The U.S. Dollar softened fractionally.

Grain markets are closed Monday, February 18, in observance of the President’s Day holiday. Farm Futures newsletters and fresh website content will resume Tuesday morning.

Corn prices engaged in some light technical maneuvering Friday to settle on some very minor changes. March futures were unchanged, at $3.7475, with May futures slipping 0.25 cents lower to $3.8275.

Corn basis bids were narrowly mixed Friday, moving 1 to 2 cents higher at several Midwestern ethanol plants and dropping as much as 2 cents lower at an Iowa processor today. Farmer sales have been generally slow this week.

Private exporters announced to USDA the sale of 8.1 million bushels of corn for delivery to unknown destinations during the 2018/19 marketing year, which began September 1. It was the sixth large export sale reported to the agency this week.

Brazilian consultancy Safras & Mercado fractionally lowered its 2018/19 corn production estimates to a still-robust total of 3.673 billion bushels.

After uncooperative weather and pest problems India may grant duty-free corn imports for the first time in three years. The country’s 2018/19 corn production is expected to drop below 630 million bushels, down around 21% from last year’s harvest.

South Korea purchased 2.7 million bushels of corn in an international tender that closed earlier today. The grain can be sourced from optional origins and is for shipment between late May and early June.

The latest USDA corn supply and demand data wasn’t bearish – but it wasn’t terribly bullish, either. See what that may mean for prices moving forward in Farm Futures senior grain market analyst Bryce Knorr’s latest Corn Outlook column.

Preliminary volume estimates were for 350,789 contracts, falling moderately below Thursday’s final count of 432,830.

Soybean prices gained some momentum Friday after further indications that U.S.-China trade negotiations made positive progress earlier this week. March futures added 4 cents to $9.0750, with May futures up 3.75 cents to $9.2150.

Soybean basis bids were steady to firm Friday after rising 2 to 3 cents higher at multiple interior river terminals and 4 cents higher at an Ohio elevator today. Farmer sales have been generally slow this week.

Brazilian consultancy Safras & Mercado slightly lowered its 2018/19 soybean production estimates to 4.240 billion bushels, after noting the worst of Brazil’s drought problems are now in the past. “The climate has improved over the last few weeks in practically all regions, preventing further losses to the crop,” it noted in a statement earlier this morning. “Our survey of fields showed us that only minor adjustments had to be made.”

The National Oilseed Processors Association released some bullish soybean crush data in its latest monthly report, out this morning. NOPA pegs domestic crush for January at 171.630 million bushels, which is slightly below December’s tally of 171.759 million bushels but moderately higher than last January’s total of 163.111 million bushels, making it the highest January total on record and the fourth-largest monthly total overall.

Soybean fundamentals remain bearish, despite a few helpful trends, notes Farm Futures senior grain market analyst Bryce Knorr. Read Knorr’s latest Soybean Outlook column to learn more about the latest factors in play.

Preliminary volume estimates were for 137,036 contracts, shifting moderately below Thursday’s final count of 195,410.

Wheat prices continued to soften Friday on another round of technical selling. March Chicago SRW futures dropped 2.75 cents to $5.0425, March Kansas City HRW futures fell 5.25 cents to $4.7625, and March MGEX spring wheat futures lost 1.75 cents to $5.7125.

South Korea made no purchases in its tender to purchase up to 2.4 million bushels of feed wheat, which closed earlier today, citing too-high prices.

There are some indications that U.S. wheat exports are on the upward swing, but is it “too little, too late” for a wheat market on the verge of life support? That’s what Farm Futures senior grain market analyst Bryce Knorr has been asking in his latest Wheat Outlook column – click here for full analysis on the latest factors pushing around prices.

Preliminary volume estimates were for 150,980 CBOT contracts, down moderately from Thursday’s final count of 215,486.

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