Weekly Cash Comments

Grain futures fell sharply this week following the release of USDA’s revised supply and demand data. As a result, corn futures were off 14 cents, while front-month Mar soybean futures plummeted 57 cents. In the cash market, basis improved on average by 2 cents for soybeans and 3 cents for corn.

In corn, the big stimulus was a sharp increase in Gulf export basis, which improved 17 cents a bushel for the week. Export business has been improving in recent weeks. This week’s export sales tally came in at 818,700 MT versus trade expectations that ranged from 550,000 to 750,000 MT. Although the Gulf was up sharply on the week, river terminals were less subdued showing only a 7-cent advance on average. Barge rates began to creep up after recent lows which limited basis strength along the Mississippi & Illinois River systems. For ethanol, basis levels were up 2 cents a bushel this week, but many plants in the Western Cornbelt saw more impressive gains of 5 to 10 cents a bushel.

For soybeans, basis at the Gulf by a slimmer margin than corn posting a 6 cent advance on the week, while river terminals as a group were up 3 cents. Even so, export sales for soybeans continue to be impressive with this week’s total eclipsing 1,100,000 MT versus trade expectations of only 700,000 to 900,000 MT. For soybean plants, basis levels improved more than the US average posting a 3 cent average for the week. Gains were most prominent in the Eastern Cornbelt with advances of 5 to 10 cents a bushel fairly typical in Indiana and Ohio markets.

—Cody Bills