A wild day in Chicago saw grain prices swing in different directions. Soybean prices received a nice bump thanks to a stronger-than-expected crush figure, while wheat prices whipped lower due to ongoing global price pressures.
Let’s dig into your daily recap of grain prices and events happening in the markets.
Today’s Broader Market Selloff
We’ll start in New York City, where the Dow Jones fell by more than 100 points. Money shifted into safe-haven assets like gold, Bitcoin, and Treasuries. The U.S. dollar slid, while global markets weighed lackluster data in Europe and Japan.
Oil prices, which recently hit a two-year high, are falling despite a weakening U.S. dollar. Oil prices fell after the Energy Information Agency slashed its global demand outlook by 100,000 barrels per day for both 2017 and 2018.
Corn Prices Can’t Break Out of Rut
The December corn contract in Chicago remained below $3.40 on the day. Despite a 0.75 cent bump on the day, we simply aren’t finding any bullish catalysts to break out of the ongoing rut. Last week’s November WASDE report offered a higher average yield than analysts had expected.
The March 2018 contract added 0.5 cents and closed the day at $3.51.
Today’s economic data couldn’t help move the needle. Weekly ethanol production fell by about 3,000 barrels last week, according to the EIA. Meanwhile, inventory levels increased by 152,000 barrels.
We’ll be turning our attention tomorrow to the latest weekly export figures and hoping for a miracle. With the world awash in corn, it’s going to take a significant catalyst to press prices higher, especially as the U.S. harvest comes to a close.
Soybean Prices Find Some Support
Finally, soybean prices pushed higher thanks to a near-record crush figure for the month of October. The National Oilseed Producers Association announced that the October crush figure came in at 164.2 million bushels. That is just below the October record we saw during the same period last year.
The January soybean contract added 8.5 cents to close the day at $9.7625. The March contract also added 8.5 cents to close the day at $9.8725. The uptick comes a day ahead of weekly export numbers. Tomorrow, analysts anticipate that we’ll see exports top 42.7 million bushels, which were reported last week.
Once again, the weather is back in focus. We’re paying close attention to La Nina and the impact on Argentina and Brazil. Check back with us later next week as we start to analyze the impact on the weather event on South American yields.
Wheat Prices Face Vicious Selloff
It was a tough day in the trenches for wheat traders. Spring wheat prices took another hit and closed below their 200-day moving average. MGEX wheat prices dropped 4.25 to close the day down 4.25 cents and finished at $6.245. Meanwhile, the March contract shed 3.75 cents and finished at $6.3925.
SRW contracts for December were off 8 cents on the day, finishing at $4.20. The March contract dropped another 7.5 cents to close a tick below $4.38. It was far worse for HRW traders down in Kansas City. The December HRW contract fell 10.25 cents to close under $4.18. The HRW contract for March closed down 10 cents and finished at $4.3525.
With export prices falling in the Black Sea, not even a weaker U.S. dollar could spur optimism. The USDA has pegged the Russian harvest at 83 million metric tonnes. But we can expect more competition and even more exports as the nation increases its export capacity.
Current export expectations from the USDA are sitting at 33 million metric tonnes.
Tomorrow, we’ll look for stronger export numbers. Analysts project that exports will come in somewhere between 350,000 and 550,000 metric tonnes.