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US Cash Grain Outlook: Corn Basis In Old/New-Crop Squeeze
CENTRAL CITY, Neb. (Dow Jones)--Cash corn, soybean, milo and spring wheat
basis continued to firm across the U.S. interior Tuesday, although winter wheat
values weakened.
Premiums paid for spot deliveries of grain sorghum rose by an average of 2
1/4 cents per bushel at terminals monitored by Dow Jones Newswires, with
average gains of 1/4-1/2 cent also seen in domestic corn/soybean/HRS wheat
basis.
"Slow sales continued to be the norm in the cash grain market, as falling
futures prices in September kept farmers out of the market," said basis analyst
Kevin McNew. "This helped bolster basis levels in many parts of the country
over the past week."
Wet weather has also hampered harvest progress, further reducing cash grain
trade.
"The new-crop corn is not drying quickly in the field, with many reports of
corn at 25%-27% moisture, and higher," said an Iowa corn buyer. "In addition,
much of the old-crop corn supply is owned by folks who are committed to
carrying inventory well past harvest, and have the space to do it. Lastly,
there are several locations in the Midwest where end-users are scrambling for
supply, in this transition between old- and new-crop supplies."
Consequently, McNew said local corn - and soybean - basis has strengthened by
some 3-4 cents a bushel in many areas during the past week, although he warns
that the basis bubble might be about to burst.
"With the recent two-day rally in futures prices and the strong basis, we
would expect grain flows to pick up this week, and be sufficient to keep end
users satisfied until harvest," he predicted. "Look for basis levels to start
backing off this week and head lower as we move towards harvest."
USDA Monday estimated U.S. harvest progress at just 9% complete for corn,
which is slightly behind the seasonal average of 10%. Six percent of the
nations soybeans have been picked, which is 1 point ahead of schedule. Grain
sorghum harvest is 31% complete, compared to the average of 23%.
Domestic hard and soft red winter wheat basis averaged 1 1/2 cents weaker
Tuesday.
Grain futures were mixed in overnight electronic trading, leaving cash
contracts 3-5 cents higher for wheat/rice - and up about 1 cent for
soybeans/oats - but 1/2 cent lower for Dec corn.
CROP WEATHER
The Joint Ag Weather Facility at USDA noted, "scattered frost was reported
this morning as far south as the central Plains, and readings below 30 degrees
Fahrenheit were noted in parts of Nebraska."
USDA said, aside from threatening immature soybeans with freeze damage, the
cool conditions are also slowing winter wheat emergence."
The agency said that only 35% of the Nebraska soybean crop had begun to drop
leaves as of Monday, compared to 56% in Iowa, 65% in South Dakota, 67% in
Minnesota and 90% in North Dakota.
Forecasters anticipate frost to occur across much of the northwestern Corn
Belt by Wednesday morning.
Dry weather favored much of the central U.S. Tuesday, while occasional
showers were seen spreading into the Pacific Northwest and along the eastern
Gulf Coast.
"However, wet fields continue to slow Midwestern fieldwork, including corn
harvesting and initial winter wheat planting," said agricultural meteorologist
Brad Rippey.
JAWF forecasters said a storm system now impacting the PNW will reach the
central U.S. toward week's end, carrying widespread rain to the
northern/central Plains and Midwest.
CENTRAL CITY, Neb. (Dow Jones)--Cash corn, soybean, milo and spring wheat
basis continued to firm across the U.S. interior Tuesday, although winter wheat
values weakened.
Premiums paid for spot deliveries of grain sorghum rose by an average of 2
1/4 cents per bushel at terminals monitored by Dow Jones Newswires, with
average gains of 1/4-1/2 cent also seen in domestic corn/soybean/HRS wheat
basis.
"Slow sales continued to be the norm in the cash grain market, as falling
futures prices in September kept farmers out of the market," said basis analyst
Kevin McNew. "This helped bolster basis levels in many parts of the country
over the past week."
Wet weather has also hampered harvest progress, further reducing cash grain
trade.
"The new-crop corn is not drying quickly in the field, with many reports of
corn at 25%-27% moisture, and higher," said an Iowa corn buyer. "In addition,
much of the old-crop corn supply is owned by folks who are committed to
carrying inventory well past harvest, and have the space to do it. Lastly,
there are several locations in the Midwest where end-users are scrambling for
supply, in this transition between old- and new-crop supplies."
Consequently, McNew said local corn - and soybean - basis has strengthened by
some 3-4 cents a bushel in many areas during the past week, although he warns
that the basis bubble might be about to burst.
"With the recent two-day rally in futures prices and the strong basis, we
would expect grain flows to pick up this week, and be sufficient to keep end
users satisfied until harvest," he predicted. "Look for basis levels to start
backing off this week and head lower as we move towards harvest."
USDA Monday estimated U.S. harvest progress at just 9% complete for corn,
which is slightly behind the seasonal average of 10%. Six percent of the
nations soybeans have been picked, which is 1 point ahead of schedule. Grain
sorghum harvest is 31% complete, compared to the average of 23%.
Domestic hard and soft red winter wheat basis averaged 1 1/2 cents weaker
Tuesday.
Grain futures were mixed in overnight electronic trading, leaving cash
contracts 3-5 cents higher for wheat/rice - and up about 1 cent for
soybeans/oats - but 1/2 cent lower for Dec corn.
CROP WEATHER
The Joint Ag Weather Facility at USDA noted, "scattered frost was reported
this morning as far south as the central Plains, and readings below 30 degrees
Fahrenheit were noted in parts of Nebraska."
USDA said, aside from threatening immature soybeans with freeze damage, the
cool conditions are also slowing winter wheat emergence."
The agency said that only 35% of the Nebraska soybean crop had begun to drop
leaves as of Monday, compared to 56% in Iowa, 65% in South Dakota, 67% in
Minnesota and 90% in North Dakota.
Forecasters anticipate frost to occur across much of the northwestern Corn
Belt by Wednesday morning.
Dry weather favored much of the central U.S. Tuesday, while occasional
showers were seen spreading into the Pacific Northwest and along the eastern
Gulf Coast.
"However, wet fields continue to slow Midwestern fieldwork, including corn
harvesting and initial winter wheat planting," said agricultural meteorologist
Brad Rippey.
JAWF forecasters said a storm system now impacting the PNW will reach the
central U.S. toward week's end, carrying widespread rain to the
northern/central Plains and Midwest.
, solo nell'ultimo minuti di contrattazione il wheat si è mosso di 10 punti 
prrr
