US farm markets were mixed, but mostly higer for the week.
Wheat prices led the grains charge on the week, all up with double digits gains.
Indeed, Chicago SRW wheat prices were up 2.95%.
MGE HRS were 2.48% higher.
KC HRW were up 4.46%.
Also corn prices posted a nice little bounce of 1.88% for the week.
Soybean, in contrast, closed the week in the red by just 0.19%.
Soy oil was up 0.91%,.
Soy meal was 0.29% lower.
On macro markets, oil prices fell on Friday as energy companies in the U.S. Gulf of Mexico restarted production after back-to-back hurricanes in the region shut output.
Indeed, Brent crude futures fell 33 cents to settle at $75.34 a barrel.
U.S. West Texas Intermediate (WTI) crude futures fell 64 cents to settle at $71.97 a barrel.
However, for the week, Brent was up 3.3% and U.S. crude was up 3.2%.
In fact Friday’s slump followed five straight sessions of rises for Brent.
On Wednesday, Brent hit its highest since late July, and U.S. crude hit its highest since early August.
The Baltic Dry Index (BDI), an assessment of the average cost to ship raw materials such as grains, coal, and iron ore, increased 11% on the week to end at 4,275.
On the financial side, U.S. stock indexes slipped on Friday led by major technology firms, while uncertainty over higher corporate taxes weighed on sentiment.
Thus, the Dow Jones Industrial Average fell 166 points, or 0.48% , to 34,584, the S&P 500 lost 41 points, or 0.91 %, to 4,433 and the Nasdaq Composite lost 138 points, or 0.91 %, to 15,043.
For the week, the S&P 500 lost 0.56%, the Dow declined 0.06% and the Nasdaq shed 0.48%.
Focus is now on a meeting of the Federal Reserve next week, with investors debating if a batch of strong economic data this week could spur the bank into shortening its timeline for reducing monetary stimulus.
The U.S. Dollar Index, meantime, increased from last week’s 92.45 to close at 93.09.
Coming back on grains market, between Saturday and Tuesday, the central U.S. will see variable rains, varying from no measurable moisture to as much as 1.5” or more in some parts of Minnesota, per the latest 72-hour cumulative precipitation map from NOAA.
The agency’s 8-to-14-day outlook predicts seasonally hot, dry weather for most of the country between September 24 and September 30, meantime.
Through September 14, 58.5% of the country is under some level of drought.
That includes most of Minnesota, the Dakotas, Iowa and Nebraska.
Meantime, last Monday, USDA tallied the US corn crop at 37% mature (31% average) and 4% harvested (5% average), as of 8/29.
Crop condition ratings slipped 1% to 58% gd/ex.
NASS Crop Progress data also showed 38% of the soybean crop dropping leaves, 9% above the average pace.
Condition ratings as of September 12 were unch at 57% gd/ex.
Winter wheat crop was 12% planted as of 9/12 according to Crop Progress data, 4% faster than the 5-year average.
On Wednesday weekly EIA data showed ethanol production increased to a 4 week high of 937,000 barrels per day.
That’s about 94 million bushels of weekly corn use at current US average yield.
On Thursday weekly corn export sales were poor at only 246,600 MT even if outstanding sales are still 20% larger than year ago, due primarily to China’s 3 week buying spree back in the spring.
Weekly soybean export sales through September 9 totaled 1.264 MMT.
China took more than 945,000 MT of that total.
Total export commitments are down 31% vs. year ago.
About the wheat, net sales of 617,100 metric tons (MT) for delivery in 2021/22, were up 59% from last week’s 388,400 (MT) and on the high end of trade expectations of 300,000 MT to 700,000 MT.
Year-to-date commercial sales for delivery in 2021/22 total 10.4 million metric tons (MMT), 21% lower than last year at the same time.
Total commitments for wheat exports are now 10.547 MMT.
That is 44% of the USDA forecast vs. the 50% average pace for this date.
USDA expects total 2021/22 U.S. wheat exports will reach 23.8 MMT, 12% lower than last year, if realized.
Friday’s CFTC Commitment of Traders report showed that the managed money spec funds had trimmed just 2,943 contracts from their net long in corn futures and options during the week ending September 14.
That took them to a net long 212,229 contracts by Tuesday.
About soybeans, data showed spec traders slicing another 2,136 contracts from their soybean net long positions for the week ending 9/14.
They took that position down to 55,380 contracts as of Tuesday, the lowest point since last August.
The report also showed money managers in CBT wheat flipped their net position from long to short by 11,172 contracts for the week ending 9/14.
That took them to net short 6,005 contracts.
In KC HRW, they trimmed 3,589 contracts from their net long for the week, to 37,646 contracts.
In this context, CBOT soft red winter (SRW) futures were up 23 cents to close at $7.09/bu.
KCBT hard red winter (HRW) futures were up 30.5 cents for the week to end at $7.13/bu.
MGE hard red spring (HRS) futures gained 21.8 cents to close at $9.01/bu.
CBOT corn futures were up 9.8 cents to $5.27/bu.
CBOT soybean futures were down 2.5 cents to close at $12.84/bu.
Corn basis bids continued to show plenty of variability across the Midwest, moving as much as 18 cents higher at an Illinois river terminal while tumbling as much as 25 cents lower at an Iowa processor on Friday.
Soybean basis bids were steady to firm at interior river terminals after rising 2 to 16 cents higher at three locations.
Bids held steady elsewhere across the central U.S..
Wheat basis bids were mixed in the Pacific Northwest (PNW) this week and slightly up in the Gulf.
High export prices compared to other origins softened basis for HRS in the PNW.
Logistical challenges remain in the Gulf following Hurricane Ida strengthening basis there.
Traders made no offers this week for HRW 12.5% protein exported from the Gulf.
Total U.S. SW 9.5% max protein offers were also limited this week.
From South America .. (Omissis ..).
In this context, as of September 16, Argentina Wheat Grade 2 export price, (Up River) was at $293, up $5 from last week.
Argentina corn feed was up $9 for the week, closing at $245.
Brazilian corn feed (Paranagua) was at $266, up $1 from past week.
Argentina barley feed, was unchanged at $265.
Argentina soybean gained 9$ to close at $550.
Brazilian soybean lifted $13 finishing the week at $566.
Matif December wheat futures gained 10 euros from last week, closing at €247,75/t.
Matif corn November futures lifted 7.5 euros to close the week at €218/t.
Matif rapeseed November futures, jumped 30,00 euros ending the week at €600,75/t.
Nov-21 UK feed wheat futures rosed £8, closing at £191/t.
Meantime, as of September 10, FOB prices for French wheat with 11.5% protein, for Sept. delivery, were at $296.85/mt, up $12.67/mt from last week.
French durum wheat, closed at $471.20, down $14.28 from last week.
Corn delivered Bordeaux Spot – July 2021 basis was at $268.58 per tonne, up $8.08 from last week.
FOB Rhin Spot – July 2021 basis was at $274.47 per tonne, down $0.95 week on week.
Feed barley delivered Rouen – July 2021 basis was at 273.29$/t, up $11.61.
Malting barley FOB Creil Spot – July 2021 basis was at $329.84 per tonne, up 4.22$ from past week.
Rapessed FOB Moselle Spot – Flat – 2021 harvest was at 703.26 $/ton, up $21.22 compared to prior week.
Standard sunseed delivered St Nazaire Spot – Flat – 2021 harvest was up $20.33 from last week at $647.90 per tonne.
As of September 13, German wheat with 12.5% protein for Sept. delivery, closed at $302.30, down 2.90/mt.
Baltic wheat with 12.5% protein was at $300 /mt, down $2.90/mt.
Indicative delivered prices in Australian dollars per tonne were:
Barley Downs: (Nearby) $288 down $4 – (New crop) $295 down $2;
Wheat Downs: (Nearby) $342 down $3 – (New crop) $335 steady;
Sorghum Downs: (Nearby) $305 up $3 – (New crop) $285 steady;
Barley Melbourne: (Nearby) $278 down $12 – (New crop) $285 down $10;
Wheat Melbourne: (Nearby) $355 down $5 – (New crop) $340 down $15.
Watching next week market, the final full week of September starts as usual with the weekly Export Inspections report on Monday morning and the Crop Progress report in the afternoon.
The FOMC will meet next Tuesday and Wednesday.
On Wednesday morning, EIA will issue the weekly update on ethanol production and stocks, with NASS releasing the monthly Cold Storage report that afternoon.
Weekly Export Sales data will be released per usual on Thursday morning.
Friday will be a busy day for livestock with NASS putting out the monthly Cattle on Feed report and quarterly Hogs and Pigs report that afternoon.
First notice day for October Cotton futures is also on Friday.
Author: Sandro F. Puglisi