DTN Daily Basis Comments

Thursday 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 unchanged at 12 cents under the December futures contract while the DTN National Corn Index was up 4 cents at $5.63. The national average basis for soybeans was 1 cent stronger at 39 cents under the January futures contract and the DTN National Soybean Index was up 26 cents at $12.38. The national average basis for HRW wheat was 1 cent stronger at 16 cents under the December futures contract and the DTN National Hard Red Winter Wheat Index was up 14 cents at $8.18. The national average basis for HRS wheat was 1 cent stronger at 29 cents under the December futures contract while the DTN National Hard Red Spring Wheat Index was up 13 cents at $9.98.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $5.63 $0.04 -$0.12 Dec $0.001
Soybeans: $12.38 $0.26 -$0.39 Jan $0.004
SRW Wheat: $7.76 $0.12 -$0.46 Dec $0.000
HRW Wheat: $8.18 $0.14 -$0.16 Dec $0.007
HRS Wheat: $9.98 $0.13 -$0.29 Dec $0.012

CORN:

The national average corn basis for Wednesday is 12 cents under the December futures, unchanged from Tuesday's basis. December corn closed up 4 1/4 cents Wednesday, thanks to the rally in soybeans and wheat. Also adding support was the EIA showing production increased at ethanol plants, which is a no brainer given strong margins and high-priced cash ethanol. This is, of course, good for corn demand and cash corn will be tough to pull out of the farmers hands as much of it has been put to bed for the winter in on-farm storage bins. While ethanol demand is supporting the corn market, it would be nice to see exports pick up as well and more than just a little here and there. The track PNW basis remains at +130Z for last half November, while CIF NOLA was unchanged and track St. Louis was 1 cent stronger. There has been an uptick in offers in the UP secondary shuttle freight as the UP services St. Louis where all the action is now. Secondary UP shuttle freight is bid $600 per car over tariff for mid-period November against no offers, while last half November is bid at $400 against offers of $1,000 over.

SOYBEANS:

The national average soybean basis for Wednesday is at 39 cents under the January futures, 1 cent stronger than Tuesday's basis. January soybeans closed up 25 3/4 cents Wednesday, a new one-month high, while December soybean meal was up $7.20, still reacting to the shortage of the feed additive L-lysine. We could see some pick-up in DDG demand as well if feeders decide to substitute. The soybean market found support from meal again but also got some help from fresh export business announced. Early Wednesday in their daily export sales report, USDA said 4.85 million bushels (mb) (132,000 mt) of U.S. soybeans were sold to China for 2021-22. Also, 30,000 metric tons (mt) of soybean oil was sold to India for 2021-22, the world's largest importer of soybean oil. Crush margins remain hefty and processors continue to take advantage of it. Basis at processors has been weaker in some Midwest plants, but overall, the flat price is strong. The track PNW shuttle basis is unchanged, while track St. Louis is 7 cents stronger for November and CIF NOLA is 4 cents stronger. St. Louis terminals will be the focus going forward for river shipments as the Upper Mississippi shipping season is coming to an end. Barge freight has been unchanged, but focus is on the St. Louis corridor looking for freight.

SOFT RED WINTER WHEAT

The national average SRW wheat basis for Wednesday is at 46 cents under the December futures, unchanged from Tuesday's basis.

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Wednesday is at 16 cents under the Kansas City December futures, 1 cent stronger than Tuesday's basis. KC December was up 13 1/4 cents, the leader of the three wheat markets Wednesday. Paris wheat surged higher on the day, but wheat markets also rallied along with the other commodities. Mills paid up on cars showing for sale in the KC spot market with 12% through 12.4% up 2 cents. They want to get covered as the holiday season will slow things down, per normal.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Wednesday is at 29 cents under the Minneapolis December futures, 1 cent stronger than Tuesday'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 unchanged at +100N; 14.5% proteins were unchanged at +105N; 15% proteins were unchanged at +135N to +160 and 16 protein was +130. Wheat receipts on the exchange floor were 9 cars, which included zero 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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