DTN Daily Basis Comments

Tuesday 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 unchanged at 25 cents under the July futures contract while the DTN National Corn Index was down 3 cents at $2.98. The national average basis for soybeans was unchanged at 46 cents under the July futures contract while the DTN National Soybean Index was down 1 cent at $7.94. The national average basis for HRW wheat was 3 cents stronger at 24 cents under the July futures contract while the DTN National Hard Red Winter Wheat Index was down 5 cents at $4.39. The national average basis for HRS wheat was 9 cents stronger at 22 cents under the July futures contract while the DTN National Hard Red Spring Wheat Index was up 5 cents at $5.00.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $2.98 -$0.03 -$0.25 Jul -$0.003
Soybeans: $7.94 -$0.01 -$0.46 Jul -$0.005
SRW Wheat: $4.94 -$0.06 -$0.21 Jul -$0.005
HRW Wheat: $4.39 -$0.05 -$0.24 Jul $0.030
HRS Wheat: $5.00 $0.05 -$0.22 Jul $0.092

CORN:The national average corn basis for Monday is at 25 cents under the July futures, unchanged from Friday’s basis. July corn closed down 2 1/2 cents to start the week, coming off lows seen earlier Monday. Favorable weather and the latest deterioration of trade relations with China is pressuring the market, along with demand destruction due to the loss of ethanol production and feed use. While ethanol plants have been slowly increasing production, we are still not back to levels we saw before Covid-19. Weekly grain inspections reported Monday for the week ended May 28 were bearish and, while slightly above what is needed each week to reach USDA's current export estimate, total inspections for 2019-20 are down 28% versus one year ago. The basis for rail delivered to St. Louis was 5 cents weaker as demand at the Gulf has been slow. The shuttle basis delivered to the Pacific Northwest has been flat as fresh business has been slow to come. Ethanol plant basis remains a mixed bag as plants needing corn continue to push spot bids, while some plants are nearing an end to their recent scheduled maintenance.

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SOYBEANS:The national average soybean basis for Monday is at 46 cents under the July futures, unchanged from Friday's basis. July soybeans closed down 1/4 cent as the market recovered off lows when talk of China buying a few cargoes of U.S. soybeans surfaced. Export inspections for the week ended May 28 came in below the amount needed to reach USDA's current estimate, while total inspections for 2019-20 are up 3% versus the prior year. Soybean oil closed higher, reaching its highest level in over six weeks and soymeal was slightly lower on the day. Gulf basis was stronger and rail basis delivered to St. Louis was 3 cents stronger. Track PNW basis is steady for May with a 3-cent carry to June. Basis on the Illinois River is stronger as we near the July 1 closure for an extensive lock repair schedule and shippers have to meet their deadlines for the last shipment date ahead of the closure.

SOFT RED WINTER WHEAT:The national average SRW wheat basis for Monday is at 21 cents under the Chicago July futures, unchanged from Friday’s basis.

HARD RED WINTER WHEAT:The national average HRW wheat basis for Monday is at 24 cents under the Kansas City July futures, 3 cents stronger than Friday’s basis. On the first day of the new crop year, HRW wheat futures were not in celebration mode as the July closed down 8 cents. Harvest has started in southwest Oklahoma, adding to current harvest in Texas. The market is under pressure from improvement in the weather in parts of the U.S. and the EU, while it won't be long before harvest pressure in the U.S. will add to the bearish tone of the market.

HARD RED SPRING WHEAT:The national average HRS wheat basis for Monday is at 22 cents under the Minneapolis July futures, 9 cents stronger than Friday’s basis. The Minneapolis spot spring wheat cash market closed as follows, basis the Minneapolis July futures contract for No. 1 milling quality: 12% proteins were not quoted; 13% proteins were not quoted; 13.5% proteins were not quoted; 14% proteins were up 20 cents to up 50 cents at +160* to +190*; 14.5% proteins were not quoted and 15% proteins were down 10 cents to unchanged at +150 to +160. Receipts were 88 cars, which includes three trains.* (Bid=B Ask=A Nominal=N) Wheat on the MGEX floor is traded delivered Chicago/beyond.

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

Follow her on Twitter @MaryCKenn

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Mary Kennedy

Mary Kennedy
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