September 22 – March Soybeans Top $10 Per Bushel

Double-digit gains for soybean contracts highlighted a busy day of trading at the Chicago Board of Trade. Meanwhile, spring wheat prices popped again on Friday. 

The broader markets were busy parsing through the barrage of insults exchange between President Donald Trump and North Korean leader Kim Jung-Un. The latter has threatened to test a hydrogen bomb over the Pacific Ocean. Meanwhile, oil prices were back above $50 per barrel at the NYMEX for the first time since July.

Here’s our daily recap from Chicago.Here’s our daily recap from Chicago.

Corn Prices Ticking Higher

We’re a week away from the monthly grain stocks report, and managed money is boosting its short position on corn.

That didn’t stop December corn contracts from adding 3.25 cents to close the day at $3.535. The March contract gained 3 cents to close at $3.66.

Markets are paying a lot of attention to the ongoing rise in production and demand of ethanol. U.S. production for 2017 is expected to surge above 16.3 billion gallons. That about 1.1 billion barrels more than U.S. production in 2016.

The question moving forward is how much Brazilian and Chinese tariffs with affect U.S. exports, which were up 30% year-over-year during the first seven months of 2017.

Money Managers Go Long Soybeans

Soybean contracts for November popped 13.5 cents to close the day above $9.82. The January contract hit $9.945, a 13.5-cent gain. The March 2018 contract is back above $10.00 per contract after adding 13.25 cents on the day.

The speculative money is once again bullish. Trading data indicates that managers are now collectively long soybeans. More than 18,000 contracts were picked up, and the net long for soybeans is sitting around 13,750 contracts.

It’s been five-straight weeks of gains for the November contract. And once again, the USDA reported another big sale through its daily reporting system. Today, they announced a 2017/2018 sale to Mexico of 190,000 metric tonnes.

For the week, the USDA reported exports of more than 1.8 million metric tonnes. 

Once again, we have to keep an eye on Brazil, where farmers have held off on planting since they received clearance to get to work on September 11. Brazil remains a very bearish factor in the global markets.

Here’s more on how Brazil’s production and acreage has surged over the last decade.

Wheat Prices Mixed Across America

At CBOT, SRW contracts for December fell 3 cents to close the day under $4.50 per bushel. The March 2018 contract dropped 2.5 cents and finished at $4.696. Markets reacted without much enthusiasm on news that money managers had cut their net short position by a little more than 4,100 contracts.

cbot-wheat-price-reversal-september-2017
Chicago Wheat Prices Have Seen A Nice Run This September

In Minneapolis, spring wheat prices popped 10.5 cents Friday to close the day a tick below $6.35. The March 2018 contracts added 10 cents and finished at $6.46 per bushel. The gains come a week ahead of the USDA’s monthly small grains report. We’ll spend next Friday pouring through the data to get a better understanding of 2017 wheat production.

Be sure to check back with us next Saturday as well for our monthly recap of global grain production.

Finally, down in Kansas City, HRW contracts were up despite news that money managers have lowered their long net position over the week. Today, we learned that the speculative money slashed its long stance by 616 contracts. All total, funds are long by 12,415 contracts.

 

 

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.

Most Recent Posts
Aug. 21 – Bullish Soybean, Corn Yields (At Least Compared to USDA)
August 21, 2019 Brennan Turner
With two days of the 4-day ProFarmer crop tour in the books, estimates of soybean and corn yields from field level are looking fairly bullish, but markets, seemingly, aren't buying it yet.
October 4: Corn Prices Edge Higher With October WASDE in Focus
October 04, 2018 Garrett Baldwin
Corn prices ticked higher Thursday as traders and analysts began to speculate on next week’s release of the October WASDE report.
Accounting for Weather Ahead of Corn & Soybean Plant 2019
March 18, 2019 Brennan Turner
While the trade war is still grabbing a lot of headlines, it's the recent volatile weather that is starting to help grain prices improve.