While it may not be a White Christmas across the Midwest, rest assured that it will be a cold one. Best to wrap yourself in a blanket, pull up the cocoa for our daily recap of grain prices from the Chicago Board of Trade.
Wheat Prices Gain a Percentage Point
An electric blanket might help indoors, but it won’t do much for wheat crops sitting out in the fields. March SRW contracts in Chicago gained nearly 1% on concerns that winter wheat will face frigid temperatures this coming weekend. The March contract added 4 cents to close at $4.235.
Down in Kansas City, HRW wheat prices for March added 2.5 cents to close at $4.225. The May 2018 contract added 2.5 cents and finished the day at $4.355. The cold snap heading for the Midwest is not expected to bring much snow. But the frost is enough to cause damage.
In Minneapolis, spring wheat prices actually declined. March 2018 contracts shed 0.5 cents and closed the day just under $6.18. The May 2018 contract dipped 0.25 cents to close at $6.26.
There wasn’t much news today outside of weather forecasts and position adjustments ahead of the coming holiday week. We did learn that Japan is looking for 4.4 million bushels of feed-quality wheat. We might see a tender in the next few days.
Corn Prices Find Some Support
The March 2018 corn contract added 1.75 cents to close the day just above $3.49. The May 2018 contract added 1.75 cents to close at $3.575.
Traders were setting their bets ahead of tomorrow’s weekly export sales figures. We’re looking at pretty wide trade expectations. The low end of the range is at 31.5 million, while the high-end sits at 47.2 million bushels.
Wednesdays are always pretty dull in the corn sector, unless you stayed up all night thinking about the weekly ethanol report. While U.S. ethanol production is sitting near record levels, weekly production dipped by 12,000 barrels per day to 1.08 million per day.
This is all happening at a time that countries around the globe appear ready to hike ethanol and other biofuel production in the years ahead. Brazil, China, the U.S., and Canada are all generating headlines, and it appears that ethanol demand will be a bullish factor for corn prices in the future.
Speaking of bullish factors, do you know what’s driving corn prices headed into 2018?
What about soybeans? Flax? Winter wheat? Or chickpeas?
FarmLead recently unveiled GrainCents, a newsletter service designed to keep farmers up-to-speed on the bullish and bearish factors impacting their grains and corresponding prices. Both Brennan Turner and I dig deep into the global markets and help farmers make an informed decision on when to sell their grain and capture the best price possible.
Learn more about it, right here.
Soybean Prices Continue to Slide
It’s been a brutal month for soybean prices. On Wednesday, the price again dipped for the January and March contracts. The front-month contract shed 2 cents to close the day at $9.54. The March contract dipped 2.25 cents and closed at $9.645.
The recent downturn has been tied to South American weather forecasts. I know it can be a little difficult to translate the newspaper down in Argentina and Brazil, unless you’re fluent in Spanish and Portuguese, respectively.
Let me do my best: It’s going to rain, it’s going to improve the outlook for the soybean crop in the region, and it’s going to cost farmers who didn’t lock in prices when soybeans were trading around $10.00 per bushel.
We’ll hope for a little bit a boost tomorrow when the USDA reports weekly export numbers. I’m not sure where traders are getting their insight to make predictions, but forecasts are all over the place.
Trade numbers are forecasted to fall in a range of 47.8 million to 71.7 million bushels.
On the Macro Front
While weather dominated the headlines for the grain markets, the story in Washington was tax reform. Today, the House of Representative put the final stamp on the largest tax reform bill in 30 years.