markets charts - green with red line phongphan5922/Thinkstock

Afternoon Market Recap for Sept. 18, 2019

Wednesday features grain market mix-up

Corn and wheat take moderate gains, while soybeans slump

Grain markets offered up a mixed performance Wednesday, as corn and wheat trended moderately higher on a round of technical buying and short-covering. Soybeans didn’t follow suit, however, after succumbing to some technical selling that left prices around 0.5% lower in today’s session.

The first day of fall arrives this coming Monday, but summertime weather is tenaciously hanging on in the Midwest and Plains, with above-normal daytime highs expected across the entire central U.S. until at least the middle of next week. Some wetter weather also returns to the region through next Monday, per the latest five-day cumulative precipitation map from NOAA, which calls for 2” or more additional rainfall for parts of the Dakotas, Iowa, Kansas, Missouri and Illinois during this time.

On Wall St., the Dow dropped about 90 points this afternoon to 27,020 after the Federal Reserve announced it will lower interest rates another quarter of a point, a move seen as risk management amid the ongoing U.S.-China trade war. The Fed appears divided on whether it will be a good idea to lower interest rates again in 2019, however. President Donald Trump, who has been an outspoken critic of the Fed in recent months, derided it as having “no guts, sense, no vision,” in a tweet earlier today.

Energy futures continue to recede after jumping double digits Monday after attacks on Saudi Arabia oil facilities were announced. Saudi officials say the country’s oil output will be fully restored by the end of the month. Crude oil, gas and diesel all dropped another 0.75% to 1.5% this afternoon. The U.S. Dollar firmed slightly.

Corn prices trended nearly 1% higher Wednesday on a round of technical buying, with expectations that USDA will report a healthy dose of export sales early Thursday morning. December futures added 3.25 cents to $3.7125, and December futures gained 2.5 cents to $3.8250.

With farmer sales slowing, corn basis bids firmed by 1 to 3 cents at two interior river terminals and fell 3 cents at an Iowa processor Wednesday, while holding steady across other Midwestern locations today.

Ahead of Thursday morning’s weekly export report from USDA, analysts expect corn sales to come in double or better for the week ending September 12 versus the prior week after they contributed a range of estimates between 35.4 million and 51.2 million bushels.

Farmers contributing Feedback From The Field continue to report wide variability in corn yields. Click here to read the latest farmer anecdotes and view our interactive map.

Ethanol production for the week ending September 13 plummeted to the lowest levels since early February, landing at a daily average of 1.003 million gallons. Stocks still rose by 739,000 barrels, however. Ethanol futures were up around 0.5% today after the U.S. Energy Information Administration released its weekly report.

In Brazil, a Reuter’s analyst poll predicts the country’s 2019/20 corn production will trend 2.3% higher year-over-year, reaching 4.027 billion bushels.

Disrupted spring applications, the potential for rising corn prices, and even energy price volatility – see how these and other factors could affect fertilizer prices moving forward in the latest Fertilizer Outlook column from Farm Futures senior grain market analyst Bryce Knorr.

Preliminary volume estimates were for 206,079 contracts, falling slightly below Tuesday’s final count of 212,177.

Soybean prices took moderate cuts of around 0.5% Wednesday as favorable forecasts are likely to continue for at least another week, and as China’s latest round of purchases came to a close after announcing large sales during the prior three sessions. November and January futures each tilted 5 cents lower to close at $8.8875 and $9.0225, respectively.

Soybean basis bids were steady to slightly mixed Wednesday, dipping a penny lower at an Illinois river terminal while firming 1 to 5 cents at two other Midwestern locations today.

Ahead of Thursday morning’s weekly export report from USDA, analysts expect the agency to show soybean sales totaling between 25.7 million and 40.4 million bushels for the week ending September 12. Analysts also expect USDA to report another 50,000 to 450,000 metric tons of soymeal sales last week, plus another 0 to 35,000 MT of soyoil sales.

Preliminary volume estimates were for 91,585 contracts, retreating moderately below Tuesday’s final count of 137,937.

Wheat prices picked up moderate to significant gains Wednesday on a round of technical buying and short-covering, with some contracts up nearly 2% in the session. December Chicago SRW futures gained 5.25 cents to $4.8950, December Kansas City HRW futures added 7.75 cents to $4.0950, and December MGEX spring wheat futures rose 6.75 cents to $5.1325.

Ahead of tomorrow morning’s weekly export report from USDA, analysts expect the agency to show wheat sales totaling between 11.0 million and 22.0 million bushels for the week ending September 12.

Algeria purchased up to 22.0 million bushels of milling wheat in an international tender that closed earlier this week. The grain is expected to ship in November.

Tunisia issued international tenders for 1.5 million bushels of soft milling wheat plus 2.3 million bushels of feed barley, with a deadline of September 19. The grain is for shipment in October or November, depending on origin.

Turkey has provisionally agreed to purchase 9.2 million bushels of soft milling wheat from optional origins in a series of tenders that closed earlier today. The grain is for shipment between mid-October and early November.

Preliminary volume estimates were for 71,282 CBOT contracts, trending 12% higher than Tuesday’s final count of 63,434.


Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.