December 1: Grain Prices Rally on Friday

Grain prices in Chicago didn’t react to the news that General Flynn may testify against President Trump over potential Russian collusion. Instead, we watched corn prices hit a three-week high, while soybean prices went green thanks to technical buyers.

Here’s your daily recap on grain prices from the Chicago Board of Trade.

December Corn Prices Hit Three-Week High

The December corn contract pushed up 3 cents to close the day just under $3.45. March 2018 corn prices also added 3 cents and closed just under $3.59.

As our friends at AgChieve explain in the chart below, prices settled at a three-week high after a two-day reversal earlier this week.

AgChieve notes March corn prices hit a 3-week high on Friday.

 

Today, there wasn’t a lot of domestic news that drove too much optimism. Instead, we were focused on South America.

We’re seeing reports that corn production in the region could fall by as much as 17% year-over-year. Agronomists in the region are reporting that bad weather, smaller yields, and fewer planted acres are starting to add up in estimates.

Despite the downturn, the nation’s trade ministers announced that November corn exports were more than 250% larger than the same period last year. Sure, it was a 30% drop from this past October, but we’re seeing some interesting movements.

Meanwhile, the planting progress in Argentina is creeping along. The Buenos Aires Exchange says that the crop is now 38.2% complete.

In the U.S., we saw an exports order for 5.1 million bushels go through the USDA’s system today.

The destination is unknown… first person to figure out where it went gets a prize.

Technical Buying Bumps Soybean Prices

January soybean prices gained 8.5 cents to close the day just above $9.94. March contracts pushed prices back above double-digits. An 8.25 cent pushed that contract to $10.06.

There was a bit of a surprise today out of Brazil. Today, they announced that they sold just 69.1 million bushels of soybeans last month. That’s a huge drop from the near 100 million bushels they sold in October.

Meanwhile, soybean planting in Argentina is coming along. The Buenos Aires Grain Exchange says that planting progress is at 42.5%. That’s an 8.5-point jump from last week’s estimate.

Wheat Prices Get a Needed Bump 

In the wheat complex, we’ll start with lots of numbers…

  • December SRW contracts added 5.25 cents to finish at $4.1450.
  • December HRW contracts in Kansas City gained 5.75 cents to close just above $4.20; and,
  • December MGEX Spring Wheat prices jumped 9.25 cents. Closing price $6.1125.

So, here’s what happened. We’re getting ready for StatsCan to drop their latest report on production expectations. Traders are setting their bets while they pay attention to a number of trends round the globe. Consensus has set expectations of around 28 million metric tonnes. That would be a jump from September estimates of about 27.13 million metric tonnes.

Over in Australia, we’re reading more about the impact of rain on the nation’s wheat crop as its harvest season kicks into full swing. The same goes for Argentina, which is accelerating the harvest right now. The Buenos Aires Grain Exchange says that the harvest is 31.4% complete.

That’s nearly an 11-point jump from last week’s progress figure.

What’s Up Next Week for Grain Prices?

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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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