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Afternoon Market Recap for September 27, 2021

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Strong demand pushes corn 2% higher.

Soybeans also stay in the green Monday, with wheat futures mixed

Good afternoon! Grain prices were mixed but mostly firm to start the week, anchored by double-digit gains for corn after bullish demand fundamentals triggered a round of technical buying that pushed prices more than 2% higher by the close. Soybeans also managed modest gains today, thanks to support from another large sale to China reported this morning. Wheat prices were narrowly mixed, meantime. CBOT futures faded slightly, while HRW and spring wheat prices moved modestly higher.

Some rains could return to the Central Plains later this week, with large portions of Kansas and Nebraska likely to see 0.75” or more between Tuesday and Friday, per the latest 72-hour cumulative precipitation map from NOAA. Areas farther east will remain relatively dry during this time. NOAA’s 8-to-14-day outlook predicts seasonally warm, dry weather form all areas east of the Mississippi River, meantime, with some wetter-than-normal conditions more likely for parts of the Southern Plains.

On Wall St., the Dow picked up 144 points in afternoon trading to reach 34,942, largely on strong performances from the energy and banking sectors. Investors were also bullish on the fact that the 10-year Treasury yield moved to the highest levels since June. Energy futures jumped higher on news of tightening supplies. Crude oil gained more than 2% this afternoon to move back above $75 per barrel. Diesel rose nearly 1.5%, with gasoline up around 1.75%. The U.S. Dollar softened fractionally.

On Friday, commodity funds were net buyers of soybeans (+1,000), soyoil (+3,500) and CBOT wheat (+4,000) contracts but were net sellers of corn (-1,000) and soymeal (-1,000).

Corn

Corn prices shook off harvest pressure to start the week, as bullish demand fundamentals spurred a round of technical buying on Monday. Surging energy prices lent additional support via some spillover strength. December futures rose 12.5 cents to $5.3925, with March futures up 12.25 cents to $5.4675.

Corn basis bids continued to show plenty of variability across Midwestern locations Monday, moving as much as 18 cents higher at an Iowa processor while tumbling as much as 25 cents lower at an Iowa ethanol plant today.

Corn export inspections improved 28% week-over-week to reach 20.4 million bushels. That was near the upper end of trade estimates, which ranged between 11.8 million and 22.6 million bushels. Mexico was the No. 1 destination, with 11.6 million bushels. Cumulative totals for the 2021/22 marketing year are still well below last year’s pace so far, with 44.9 million bushels since the start of September.

Ahead of the next USDA crop progress report, out later this afternoon, analysts expect to see stable corn quality ratings from a week ago, with 59% of the crop rated in good-to-excellent condition through September 26. And harvest progress is expected to move from 10% last week up to 19%.

Preliminary volume estimates were for 189,558 contracts, trending moderately above Friday’s final count of 118,118.

Soybeans

Soybean prices moved modestly higher on some light technical buying Monday, thanks in part to spillover strength from strong corn gains. A large sale to China reported this morning lent additional support. November futures picked up 2.75 cents to $12.8775, while January futures added 3 cents to $12.9775.

Soybean basis bids dropped 25 cents lower at an Indiana processor while firming 2 to 6 cents higher at three interior river terminals on Monday. Bids at other Midwestern locations held steady today.

Private exporters announced to USDA the sale of 12.3 million bushels of soybeans for delivery to China during the 2021/22 marketing year, which began September 1.

Soybean export inspections improved to 16.2 million bushels last week, versus the prior week’s tally of 10.2 million bushels. That was also on the higher end of trade estimates, which ranged between 5.5 million and 18.4 million bushels. China was by far the No. 1 destination, with 10.6 million bushels. Cumulative totals for the 2021/22 marketing year are still only about a fifth of last year’s pace after reaching 34.6 million bushels.

Ahead of the next crop progress report from USDA, out later this afternoon, analyst expect the agency to hold soybean quality ratings steady, with 58% rated in good-to-excellent condition through September 26. And harvest progress is expected to move from 6% completion a week ago up to 15% through Sunday.

As exports to China continue to look promising of at least getting close to the ambitious goals set out by the Phase 1 trade deal, farmers may not be out of the water yet on trade frictions with our top agricultural trade partner, according to recent reporting from Farm Futures policy editor Jacqui Fatka. Learn more about the Biden Administration’s latest trade strategies.

Preliminary volume estimates were for 139,881 contracts, moderately besting Friday’s final count of 98,104.

Wheat

Wheat prices were mixed but mostly higher after an uneven round of technical maneuvering Monday. MGEX spring contracts saw the biggest lift, with December futures rising 6 cents to $9.22. Kansas City HWR contracts also saw modest gains, with December futures picking up 1.5 cents to $7.2125. Chicago SRW contracts bucked the overall trend, with December futures easing 0.75 cents to $7.23.

Wheat export inspections were lackluster, falling to about half of the prior week’s total to 10.5 million bushels. That tally was also below all trade guesses, which ranged between 14.7 million and 23.0 million bushels. Nigeria topped all destinations, with 1.8 million bushels. Cumulative totals for the 2021/22 marketing year still lag moderately behind last year’s pace, with 294.0 million bushels.

Ahead of USDA’s next crop progress report, out later this afternoon, analysts think the agency will show 2021/22 winter what plantings at 34% completion through September 26, versus 21% a week ago.

Russia’s agriculture ministry reports that the country’s grain exports so far in the 2021/22 marketing year are down 22.4% from a year ago, citing increased global competition. That includes wheat exports totaling 308.6 million bushels through September 23. USDA expects Russian wheat exports to reach 1.286 billion bushels this marketing year.

Settlement Prices for Key Commodities 
  High Low Last Change
Corn                     $/bushel  cents/bu    
21-Dec 540 524 539.5 12.5
22-Mar 547.25 531.5 547 12.25
Soybeans        
21-Nov 1297 1282 1287.5 2.75
22-Jan 1306.75 1291.75 1297.5 3
Soymeal                $/ton        
21-Dec 343.9 338 340 1
Soyoil                    cents/lb        
21-Dec 58.6 57.05 58.11 0.31
Wheat                    $/bushel        
21-Dec 728.5 720.25 722.25 -0.75
22-Mar 739.5 731.75 733.75 -0.5
KC Wheat        
21-Dec 724.5 717.5 720.75 1.5
22-Mar 732.25 725.75 728.5 0.75
MPLS Wheat        
21-Dec 923 915.25 921.5 6
22-Mar 908.75 901.5 907.25 5.25
Live Cattle             cents/lb        
21-Oct 123.8 122.1 122.15 -0.775
Feeder Cattle         cents/lb        
21-Oct 157.35 154.2 154.35 -3
Lean Hogs             cents/lb        
21-Dec 81.55 79.75 81.55 4.75
Crude Oil  $/barrel *Energy prices may not represent final settlements      
21-Nov 75.75 74.16 75.35 1.37
Diesel        
21-Oct 2.3116 2.2689 2.292 0.0249
Unleaded Gasoline   $/gallon        
21-Oct 2.2286 2.1837 2.2191 0.0316
Natural Gas        
21-Nov 5.741 5.238 5.72 0.52
Ethanol Futures        
21-Nov     2.207  
U.S. Dollar Index        
21-Dec 93.495 93.195 93.385 0.05
Gold                      $/ounce        
21-Oct 1758.7 1744.1 1752.9 3.2
Copper        
21-Sep 4.305 4.2615 4.3 0.0125
Fertilizer Swaps     (as of 09/24)  
DAP Tampa-index              655.0 0
DAP-New Orleans              722.0 -18
Urea-New Orleans              620.1 42
Urea-Middle East              562.5 65
Urea-Black Sea              525.0 75
UAN (32%) New Orleans              325.2 0

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