Closing Market Comments October 13, 2022

Today’s Prices

Grain markets started the day out lower but reversed and closed higher on a massive reversal in the outside markets as well.

Grain Market News

Weekly Ethanol Production

Production increased nicely to 932 thousand barrels per day.

That’s a big jump for the second week in a row.

We are still well below the year ago level and well below the level needed.

Therefore, additional large increase is needed as we move into November-January timeframe.

Today’s ethanol production was down 9.7% from a year ago.

Our year-to-date production is down 1.8% and that below USDA’s estimate.

Weekly Stocks for Fuel Ethanol

Stocks increased slightly; they are not at a burdensome level, but stocks are well above last year while driving miles are well below last year.

Stocks certainly adequate for ethanol if not somewhat of a surplus.

Ethanol stocks are currently 10% above the year ago level.

Grain Market News

Brazilian Corn Stocks

 Stocks are estimated to be at about 49mmt versus 28mmt last year.

That’s a dramatic increase in Brazilian corn supplies and Brazil’s operating those corn stocks at cheap levels a $1 below the US.

Supplies are tight in the U.S., but export demand is being hurt significantly.

U.S. Cumulative Weekly Corn

This year our sales on the books are just above 20% of USDA’s export total, last year our exports were over 40% of USDA’s export estimate.

World Soybean Production

This year our soybean production will be down from 122mmt to 117mmt this year.

That’s a tight supply side of the US balance sheet.

Some countries have a major increase which more than offset the decrease in the U.S.

U.S. Corn Ending Stocks

Yesterday the USDA projected ending stock at 1172, that is a small number and not much room for error.

Current prices of corn as of today are trading around $7, last year at this time they were trading around 5.40.

U.S. Soybean Ending Stocks

Soybeans at 200 million bushels are also very tight.

Soybean prices are getting closer to the $14 level, last year at this time stocks were a little higher and trading at $12.30.

U.S. Wheat Ending Stocks

Wheat stocks are tight at 576, which are about what they were last year at this time.

This year wheat prices are trading very close to $10 per bushel, last year they were trading around $7.50.

December Corn Chart

Corn prices continue to be in an uptrend, and we have consolidated this week.

7.06 the high on Monday with 6.81 the low yesterday.

That’s a 25-cent trading range and todays higher close still keeps that overall uptrend intact.

As the days go on, we do need to see this market, from a chart perspective, take out the 7.06 high.

November Soybean Chart

Soybeans are also in an uptrend but today was also an inside day.

The soybean chart still looks good, indicating we may have put in some harvest lows last week and the technical indicators looking good as well.

December KC Wheat Chart

Wheat prices had a wild day making anew low this morning at 9.52 then turned around and closed significantly higher.

The chart looks like it’s trying to break out to the downside but todays close was a nice recovery keeping us in an up-trending channel.

We do need to see wheat stay strong and close higher again tomorrow.

Questions or Comments