DTN Daily Basis Comments

DAILY BASIS AND CASH INDEX SUMMARY:

The national average basis for corn was unchanged at 20 cents under the December futures contract while the DTN National Corn Index was up 16 cents at $4.03. The national average basis for soybeans was 1 cent weaker at 52 cents under the January futures contract while the DTN National Soybean Index was up 35 cents at $10.94. The national average basis for HRW wheat was unchanged at 26 cents under the December futures contract while the DTN National Hard Red Winter Wheat Index was up 9 cents at $5.35. The national average basis for HRS wheat was 1 cent stronger at 25 cents under the December futures contract while the DTN National Hard Red Spring Wheat Index was up 7 cents at $5.36.

	DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$4.03	$0.16	-$0.20	Dec	$0.001
Soybeans:	$10.94	$0.35	-$0.52	Jan	-$0.006
SRW Wheat:	$5.79	$0.11	-$0.29	Dec	-$0.004
HRW Wheat:	$5.35	$0.09	-$0.26	Dec	-$0.001
HRS Wheat:	$5.36	$0.07	-$0.25	Dec	$0.001

CORN:

The national average corn basis for Tuesday is at 20 cents under the December futures, unchanged from Monday's basis. December corn was sharply higher Tuesday, up 15 1/2 cents, thanks to a surprise in the USDA report. Tuesday's WASDE report showed higher-than-expected cuts in corn production and yield, sending the corn market surging on the day. USDA forecast corn yields to average 175.8 bushels per acre (bpa), down 2.6 bpa from October. USDA also estimated an increase in exports of 325 million bushels (mb) and decreased ending stocks by 465 mb. In a separate export sale notice prior to the report, USDA said private exporters sold 130,000 metric tons (mt) of corn for delivery to South Korea during the 2020/2021 marketing year. As the cash price of corn moves higher, end users may have a tough time buying needs, especially given we are in a carry market right now through May 2021. The track PNW shuttle basis was unchanged, while CIF NOLA basis was 2 cents weaker. The BNSF secondary shuttle freight market has fallen lower nearby with November bid at $150 per car above tariff against offers of $250 and December is bid at $500 per car against offers of $600. UP secondary freight for last half November is bid at $100 per car against offers of $300 and December is bid at $200 per car against offers of $400. River basis in some spots is sharply lower as some terminals are unable to find empty barges to load out their full bins.

SOYBEANS:

The national average soybean basis for Tuesday is at 52 cents under the January futures, 1 cent weaker than Monday's basis. January soybeans surged Tuesday, up 35 1/2 cents, after the USDA report showed a U.S. soybean yield at 50.7 bpa, putting ending stocks at 190 mb for 2020-21, a 7-year low if realized. Notably left out was a change to the soybean export number which the market had expected to show an increase, given the strong pace of U.S. soybean sales. The sharp rise in the soybean market pulled soy oil futures up 53 cents and meal up 10.70, which pushed cash soybean meal prices higher on the day and, in turn, caused protein and other substitutes for soybean and soybean byproducts prices to move higher as well. The track PNW shuttle basis was 5 cents weaker, St. Louis was 14 cents weaker and CIF NOLA prices were 10 cents weaker. Barge freight is still high for this week as empty barges cannot be found. More barges are expected to move north next week and the week after, which could push barge freight lower. American Commercial Barge Line (ACBL) reported the Lower Mississippi River will close intermittently for dredging operations near mile 719, causing temporary slowdowns for north and southbound traffic. The river did reopen Tuesday Monday, but barge lines are waiting to hear if more dredging will take place in the Lower Mississippi River.

SOFT RED WINTER WHEAT:

The national average SRW wheat basis for Tuesday is at 29 cents under the December futures, unchanged from Monday's basis.

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Tuesday is at 26 cents under the Kansas City December futures, unchanged from Monday's basis. KC December closed up 9 cents, mainly finding support from the surge in corn and soybeans on the day. The USDA report was mostly a non-event for wheat and while they did increase food usage 5 mb based on the National Ag Statistics Service (NASS) Flour Milling report, they left the 975 mb export estimate unchanged. Wheat ending stocks were lowered slightly from 883 mb to 877 mb. Milling basis is still unchanged based on the lack of cars showing for sale recently and export basis is flat.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Tuesday is at 25 cents under the Minneapolis December futures, 1 cent stronger than Monday's basis. The Minneapolis spot spring wheat cash market closed as follows, basis the Minneapolis December futures contract for No. 1 milling quality: 12% proteins were not quoted; 13% proteins were unchanged not quoted; 13.5% proteins were not quoted; 14% proteins were down 35 cents to down 5 cents at +105* to +135; 14.5% proteins were unchanged at +130N; 15% proteins were up 15 cents to unchanged at +170*. Receipts were 108 cars, which included four 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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