November 13: Bombs Away for Grain Prices

Soybean prices slump again, wheat prices wilt, and December corn slide toward $3.40. Here’s your daily recap of grain prices from the Chicago Board of Trade.

Lower Russian Wheat Prices Drag on Global Market

Let’s start our recap of grain prices in the wheat market.

December wheat prices dipped 7.25 cents to close the day a tick above $4.24.  The March contract slipped 5.75 cents and finished a tick above $4.43.

December Hard Red Wheat contracts fell 5.75 cents to finish the day at $4.275.

Spring wheat prices faces the greatest pressure. The December MGEX contract fell more than 2% on the day, dipping 14.25 cents.

What’s pulling prices lower? Several factors.

Among them first is the ongoing decline in Russian wheat export prices. Weakness in demand and a stronger U.S. dollar continue to weigh on Black Sea prices. Even though Russia is poised to export record wheat shipments, the weak ruble is furthering the downturn. It’s a story that we’ve told multiple times, but Russian exports are weighing down prices around the globe.

Other news affecting prices negatively include the smaller-than-expected wheat export figure reported by the USDA this morning and money managers’ increase in their net short position.

This afternoon, the USDA reported its weekly Crop Progress report.

The agency said that 95% of the winter wheat crop has been planted. That figure is in-line with the five-year average. In addition, the agency said that 84% of the crop is emerged, while 54% of the crop is rated Good-to-Excellent.

The latter figure is down from the 55% reported last week.

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Soybeans Lead Grain Prices Lower

We saw November soybean prices fall to just above $9.63 on the day as markets continue to weight data from the November WASDE report. Among grain prices in Chicago, soybean results were the largest decliner.

That figure is 37 cents lower than prices hit the day after the release of the October WASDE report. The January contract was also off by double digits and fell below the 200-day moving average.

In addition to news of last week’s huge crop report, markets continue to weigh the uptick in export competition from South American producers and increasing rains in key planting regions across Brazil.

Finally, markets were little impressed by last week’s export figures. Though China has continued its buying spree, the U.S. only sold 76.7 million bushels last week. That number was in line with trade analysts’ expectations.

This afternoon, the USDA reported that the soybean harvest is 93% complete. That figure is two percentage points below the five-year average.

Corn Prices Again Slide

December corn prices continued to slump Monday.

December corn futures contracts shed 1.25 cents to close at $3.4225. The March 2018 contract slid 1.75 cents to close at $4.55.

Last week’s WASDE report recorded a record crop for the United States. The USDA reported a much larger average corn yield than trade analysts had expected. With the world awash in corn, markets were anxiously awaiting the release of today’s Crop Progress report.

Finally, the USDA said that the corn harvest is 83% complete. That is a 13-point gain from the previous week, but still eight percentage points below the five year average.

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About the Author
Garrett Baldwin

Garrett Baldwin is a content strategist and editor at FarmLead. He covers the global grain markets and public policy issues related to the agricultural industry. He is a graduate of the Medill School of Journalism at Northwestern University. He also holds a Master’s Degree in Economic Policy from The Johns Hopkins University, an MS in Agricultural Economics from Purdue University, and an MBA in Finance from Indiana University.

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