The action in today’s grain markets wasn’t happening in Chicago. Kansas City wheat prices rallied more than 2% Tuesday thanks to ongoing weather woes and issues surrounding crop quality across the Midwest. Meanwhile, corn prices and soybean prices ticked higher.
Here’s our daily recap from the Chicago Board of Trade.
What Prices Whip Higher
A big day in the futures markets pushed wheat prices to a seven-month high. Markets continue to monitor weather delays in Russia, crop quality issues in the U.S. and Argentina, and the latest offers to Jordan, who turned down shipments today.
In Kansas City, March HRW contracts added 11.25 cents closed the day at $4.89 per bushel. The May contract popped above $5.00 per bushel to close up 11.25 cents ($5.0475).
Meanwhile, spring wheat prices in Minneapolis were largely flat. The March contract added 0.5 cents to close at $5.965, while the May contract fell 0.75 cents to close at $6.09 per bushel.
In Chicago, the March SRW contract added 3.75 cents to close a tick above $4.63. The May contract added 4.25 cents to close at $4.77 per bushel.
Soybean Prices Continue to Climb
The March soybean contract in Chicago added 3.75 cents to close at $10.38 per bushel. The May contract added 3.5 cents to end just below $10.50 per bushel.
Once again, markets are keeping watch on crop conditions down in South America.
Right now, Argentina’s drought is providing a double bump for soybean prices. First, we’re preparing for next week’s WASDE report, and analysts have been slashing their expectations for the Argentine corn and soybean crop ahead of time. The possibility of a 39 MMT soybean crop and 31 MMT corn crop for the country is providing support across both markets.
But then there’s the fact that we’re seeing farmers down in Brazil and Argentina holding out for the best price possible. We’ve seen some reports stating that on soybeans, farmers are looking for the equivalent of $11.00 per bushel.
The other major factor at play is the delay in Brazilian harvest that is causing logistical problems across the country. Even though Brazil is likely sitting on a record harvest, rainy weather and general legacy infrastructure problems are delaying shipments at the ports
Corn Prices Whip Higher on Argentina
Once again, markets are turning their attention to the March WASDE report, which will hit our desk late next week. Ahead of that report, Dr. Michael Cordonnier eyed Brazil and Argentina ahead of the event.
Cordonnier cut his forecast for Argentine production by another 1 million metric tonnes to 36 MMT. Meanwhile, he kept his Brazil figure at 86 MMT. Both numbers trail USDA projections. While the markets anticipate that the USDA will make downward revisions next week, we remind people not to get too carried away. The agency has a history of being conservative on the issue, even when analysts are standing in fields where the crop is burned to a crisp.
Today, the March corn contract added 2 cents to close the day at $3.705 per bushel.
The May contract added 2 cents to end the day a tick above $3.79.
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