Today’s Prices

Corn and soybean prices finished higher today on very strong weekly export sales numbers.

Grain Market News

Corn: Weekly Export Sales

Looking at the weekly export sales beginning with corn, 2.114mmt was sold for the corn market, that is a huge number for any wheat especially when we only need 512 thousand tons per week to reach USDA forecast.

We won’t see this large of sales every week, but we do expect to see consistent sales coming in above the black line, which is the number needed to reach USDA forecast.

Therefore, we do believe US corn exports will be significantly above the number USDA is currently forecasting.

Soybean: Weekly Export Sales

Soybeans were also a very good number for virtually any week of the marketing years. 2.204mmt and we only needed a 173 thousand tons to reach USDA expected forecast.

We do believe that losses in South America will result in US export sales, through early summer, consistently running above USDA totals.

Soybean exports are also likely to exceed USDA totals. The fact that we believe US corn and soybeans will exceed USDA current estimates, that means that our ending stock numbers will slip lower in the April-June report.

Wheat: Weekly Export Sales

Wheat export sales were somewhat disappointing coming in at 300 thousand tons, but keep in mind due to USDA lowering our wheat export estimates the last 3 months we only need 289 thousand tons to reach USDA forecast.

We believe that the USDA target will be reached and if we start to see better exports, due to lack of supplies out of the Black Sea region, it’s possible that USDA may have to raise its export forecast in future crop reports.

Grain Market News

U.S. Corn Monthly Ending Stocks

This chart shows monthly for each given crop year for example the green line is this crop year 2021-22 which will continue now through the end of August. USDA’s estimate of stock for corn has been steady to slightly larger over the last 5-6 months.

USDA lowered ending stocks by 100 million bushels and the trade believes that trend will continue going forward as exports continue to exceed USDA estimates, which will shrink ending stocks.

This would be similar to the scenario we seen last year, which is the red line, when stocks reached a low point in July at 1.082 billion bushels.

We aren’t that low with ending stocks at this point, but again the market believes that we are heading in that direction.

U.S. Soybeans Monthly Ending Stocks

Soybeans were steady for about 5-6 months as well, but stocks declined last month and now this month a little bit further to 40 million bushels smaller since the 285.

That’s not as small as the stocks that were projected February- May last year when USDA was projecting 120 which was pretty much a bare pipeline minimum.

The market believes these numbers will be shrinking lower over time as US exports are likely to exceed USDA current forecast.

U.S. Wheat Monthly Ending Stocks

Stocks of wheat have been consistently increasing over the past 4-5 months, current stock projected at 653 are larger than projected last Fall at 580.

But keep in mind it is still the smallest stock estimate over the past 8 years and if the war rages on between Russia and Ukraine, it’s very possible that some nations will need to come to the US for wheat supply and that could allow wheat prices to gradually start moving lower over the next few months as well.

It’s not only that our stocks are relatively tight, but also the idea that our stocks in the US of corn, beans, and wheat could get tighter in the months to come.

That does not mean that corn prices are going to have to rally to $8 immediately but it does tell us that corrections and setbacks, which will happen, will likely be relatively short lived and likely will present buying opportunities for end users given the tight projections that the market views going forward.

U.S. Grain Stocks

When we look at a combined chart, we can see that the total this year is slightly above last year’s total.

It is still very small compared to the previous 6 years and if estimates are correct the stocks of US corn, beans, and wheat could significantly shrink in the next few months.

We could end up with stocks ending well below last year and the lowest going back to the 2012-2014 timeframe.

This graph may help explain why it is that we believe; yes, there will be corrections and setbacks from time to time and they will be sharp from time to time, but we are not expecting a long-term downtrend given the tight supplies that are currently in place and the fact that they may get even tighter.

March Corn Chart

Corn prices did rally today, but we did not take out the high posted last week at 7.82. That would be overhead resistance with current chart support the double bottom that’s been established, at least so far, at 7.28 both Tuesday and again today.

Todays close at 7.55 is 27 cents above the chart support and 27 cents below the overhead resistance.

Anything within this range is fair game over the next week or so, with day-to-day headlines regarding the Russian/Ukraine war likely to provide the primary price direction in the near term.

March Soybean Chart

Soybean prices were up today, but we did not challenge the highs from yesterday at 17.34 and have not challenged the highs from about 2-weeks ago at 17.59.

Todays close at 16.86 is about 75 cents below the contract high posted 2 weeks ago and it’s a little over a dollar above the low posted 2 weeks ago as well.

We believe that anything within this range is fair game at this time and day to day headlines regarding the Russia/Ukraine war likely to provide price direction.

March KC Wheat Chart

Wheat prices exploded to the upside trading limit up 5-6 days in a row, but when a market explodes to the upside it is also at risk of falling sharply to the downside and that’s what we are seeing in wheat prices at this time.  

Wheat has fallen about a 1.60 off the highs, doesn’t mean it can’t slip further, but we do believe if prices approach $10 or in the low $10 range, we are likely to start finding support.

In the near term the chart does look negative from a chart perspective, technical look very negative. But the shear lack of supply coming out of the Russia/Ukraine region is likely to provide support on any further break.

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