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Today’s Prices
Grain markets finished mixed today as the USDA provided some mixed news when it comes to stocks and acres for our grain markets.
Grain Market News
2022 Prospective Planting
Corn acres at 89.49 about 2.5 million acres below what the trade was expecting and down nearly 3.9 million acres from last year.
Bean acres at 90.955, 2.14 million above what the trade was expecting and up 3.76 million from last year.
Wheat acres at 47.351 did come in about 400 thousand acres below the average trade guess but up about a half million from last year.
When we combine corn, bean, and wheat acres to get 227.8 million, about 700-800 thousand acres below what the trade was expecting. This was very close to the USDA’s outlook forum and up just about a half million acres from last year.
The total acres, again, was not a major surprise, but the mix of acres is where the surprises came in.
Soybean/Corn Ratio
This corn and bean ratio would be new crop November soybeans for 2022 divided by new crop December corn prices for 2022.
As prices work towards the upper end of this chart that would favor soybeans as prices would work towards the lower end of the char that would favor corn.
As we move through Winter, December-March, keep in mind this survey was sent to farmers in February with farmers to respond by the 1st of March.
At that time when this survey was produced the market was starting to favor a little bit more beans, combine that with high fertilizer prices which may have provided farmers with an incentive to plant more beans.
We saw today that corn acres came in below expectation and bean acres came in above expectation.
But we also what to note that since about the 1st of March the bean and corn ratio has been collapsing with a huge collapse in the price today. With new crop corn sharply higher and new crop bean sharply lower.
This report is intentions, farmers intentions as of the 1st of March, but because prices have changed rather significantly, we would believe that this could provide incentive to maybe start thinking about planting a little bit more corn and a little less beans based on the big change in the relationship between corn and soybeans since the 1st of March.
Grain Market News
Quarterly Stocks: March 1, 2022
Corn stocks came in at 7.850bb, the average guess was 7.885, therefore we came in 35 million bushels below what the trade was expecting.
Bean stocks at 1.931, came in 38 million bushels above what the trade was expecting.
Wheat stocks at 1.025, 39 million bushels below what the trade was expecting.
Again, this was considered bullish for corn and wheat and bearish for beans.
Corn Weekly Export Sales
Corn sales were somewhat disappointing at 637 thousand tons, that’s down from the last few weeks but it’s still well above the level needed on a weekly basis to reach USDA export forecast.
Due to substantial losses to South American crop due to the drought in December-February, combined with loss supply availability out of the Black Sea region of Russia/Ukraine, we believe that exports will consistently run at or above the level needed all the way through June.
We believe that US export sales will end up the year much larger than USDA is currently projecting.
That will lower ending stocks down the road for US corn.
Soybean Weekly Export Sales
Soybeans were very good at 1.306mmt, we only need 67 thousand tons, which means we have almost reached USDA’s target for sales already.
Due to losses in South America, we believe that our exports will run at or above USDA target for the next 3-4 months.
That means that US exports in soybeans will likely end up well above USDA’s target which will lower US ending stocks for soybeans.
Wheat Weekly Export Sales
Wheat export sales were disappointing at just 96 thousand tons, that’s 3 weeks that wheat has now been disappointing.
Despite the Russia/Ukraine war and the fact that Ukrainian supplies are virtually not available to the world marketplace and Russia’s supplies are being sanctioned, we are still not seeing much demand shifting to the US.
Europe, India, and Australia seem to be making up for the loss of the Black Sea supplies with the US not getting in on the business, at least not at this time.
We need to see US exports improve quickly over the next couple weeks or we are at a risk of USDA wheat exports falling below USDA current projection.
24-Hour Observed Precipitation
Heavy rains anywhere from 1-3 inches of rain fell across portions of Missouri, central and southern Illinois, and even portions of the Delta.
This adds to where we are already seeing excessive moisture down in the southern portion of the US where planting is trying to start or will be starting in the next week.
14-Day Observed Precipitation
When we look at the past 2 weeks, you can see from the Delta all the way u pinto the southern Ohio valley and portion of the southern belt heavy rains anywhere from 2-5 inches of rain have fallen over just the last couple of weeks.
It’s still early but this is something that is becoming somewhat of a concern and needs to be monitored going forward.
Keep in mind planting is already beginning in the deep south and farmers would like to start planting in the 1st week of April in the northern Delta and extreme Ohio valley. It’s quite wet in those areas which is why this may be a concern.
Its also possibly a concern for the central belt as we head towards the middle of April.
7-Day Precipitation Forecast
The 7-Day forecast calls for additional rain, nothing extremely heavy, but nonetheless additional rain from that central belt of Missouri, Illinois, portions of Indiana all the way down through the Delta region.
Again, we could see some delayed planting if this forecast is correct.
March Corn Chart
Corn prices broke out above the previous highs, and we posted a new high for the move at 7.53 in July corn.
That keeps the overall long term, intermediate term trend up and also now has turned the short-term trend up as well.
Unfortunately for the close, we closed at $7.33, that’s 20 cents off the highs, but still sharply higher on the day.
Even though we didn’t close at the highs it was still a good day, enough to turn the technical indicators back to the upside.
Both the chart and technical look pretty good following today’s big move to the upside.
March Soybean Chart
Soybean prices have been chopping back and forth in a mostly sideways range, today we remained within that range.
But todays close was very disappointing, we closed near the days low and right at long term chart support from our up-trending line.
If that does not hold the next level of chart support would be the spike lows at 15.68, that’s about 30 cents below where we closed today.
Todays move to a new low for this move at 15.94 also has the technical pointed downward.
March KC Wheat Chart
Wheat prices had mixed news today, prices did trade sharply higher at one point, but we closed at the daily low. Todays close nearly 50 cents off the daily high.
It was a very volatile day up and down back and forth, but overall, we do believe that the charts look pretty good other than today’s disappointing close.
The technical indicators, although they are still pointed downward, are very gradually downward and may be trying to level off.
Even though wheat could have some additional downside risks for the lows that were posted this week, we are not bearish wheat from the $10 level.
Questions or Comments
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