DTN Daily Basis Comments

Wednesday Morning Basis Update

Mary Kennedy
By  Mary Kennedy , DTN Basis Analyst
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DAILY BASIS AND CASH INDEX SUMMARY:

The national average basis for corn was 1 cent stronger at 12 cents under the December futures contract while the DTN National Corn Index was down 5 cents at $5.59. The national average basis for soybeans was 1 cent stronger at 40 cents under the January futures contract and the DTN National Soybean Index was down 5 cents at $12.12. The national average basis for HRW wheat was 1 cent weaker at 17 cents under the December futures contract and the DTN National Hard Red Winter Wheat Index was down 16 cents at $8.04. The national average basis for HRS wheat was 1 cent weaker at 30 cents under the December futures contract while the DTN National Hard Red Spring Wheat Index was down 12 cents at $9.85.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $5.59 -$0.05 -$0.12 Dec $0.008
Soybeans: $12.12 -$0.05 -$0.40 Jan $0.009
SRW Wheat: $7.64 -$0.20 -$0.46 Dec -$0.041
HRW Wheat: $8.04 -$0.16 -$0.17 Dec -$0.007
HRS Wheat: $9.85 -$0.12 -$0.30 Dec -$0.008

CORN:

The national average corn basis for Tuesday is 12 cents under the December futures, 1 cent stronger than Monday's basis. December corn closed down 5 1/2 cents as the wheat market turned lower on the day and also due to USDA reporting 91% of the corn was harvested as of Nov. 14. The market brushed off the USDA reporting a fresh sale of 10.6 million bushels (mb) (270,000 metric tons) of U.S. corn sold to Mexico for 2021-22. The market also seemed to have little reaction to the news that Vietnam would lower its tariff on U.S. corn from 5% to 3% beginning Dec. 30. With the U.S. harvest nearly over, end users will have to step up the cash price in order to entice farmers to sell their corn that is likely tucked away in bins on farm. The track PNW shuttle basis was unchanged, while track St. Louis was 1 cent stronger and CIF NOLA basis was unchanged. Some strength was seen in the Upper Mississippi River as shippers are busy loading out barges ahead of the winter lock closures. Barge freight is pretty quiet, and as of next week, there are no quotes for the St. Paul district as locks 1-10 as barge loadings there will stop this week.

SOYBEANS:

The national average soybean basis for Tuesday is at 40 cents under the January futures, 1 cent stronger than Monday's basis. January soybeans closed down 6 cents, while December soybean oil closed up 0.97 cents. Early in the day, USDA reported 5.9 mb (161,000 mt) of soybeans were sold to unknown destinations for 2021-22. While it's good to see fresh sales, exports are still behind to keep in pace with the current USDA estimate for soybean exports this crop year. The Monday afternoon Crop Progress report did show 92% of soybeans were harvested, with the soggy eastern Midwest still playing catch up. The track PNW shuttle basis was 5 cents stronger for November, while track St. Louis was 3 cents stronger and CIF NOLA was unchanged. Processor basis is mixed, but still a good price for cash soybeans as crush margins remain strong.

SOFT RED WINTER WHEAT

The national average SRW wheat basis for Tuesday is at 46 cents under the December futures, 4 cents weaker than Monday's basis.

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Tuesday is at 17 cents under the Kansas City December futures, 1 cent weaker than Monday's basis. The KC December was down 15 1/4 cents after hitting its highest spot price in seven years. While Monday's crop progress report showed 94% of the winter wheat crop was planted, 46% of the winter wheat crop was rated good to excellent, tied for the third lowest rating since 2010. Time has just about run out for planted winter wheat to get established and that will be the key factor next spring as to how much winter wheat, all classes, made it through the winter. There were no cars for sale on the spot market and CIF NOLA bids perked up on the day and that could have been due to the Egypt tender, but U.S. wheat will not come close to being competitive.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Tuesday is at 30 cents under the Minneapolis December futures, 1 cent weaker than Monday's basis. The Minneapolis spot spring wheat cash market closed as follows basis the Minneapolis December futures: 12% proteins were not quoted; 13% proteins were not quoted; 14% proteins were up 40 cents at +100N; 14.5% proteins were unchanged at +105N and 15% proteins were up 5 cents to unchanged at +135 to +160. Wheat receipts on the exchange floor were 27 cars, which included 1 train(s).* MGEX Daily Grain Prices are Delivered Chicago/Beyond: Spot No. 1 Milling Northern/Dark Northern Spring Wheat.

Mary Kennedy can be reached at mary.kennedy@dtn.com

Follow her on Twitter @MaryCKenn

Mary Kennedy

Mary Kennedy
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