DTN Daily Basis Comments

DAILY BASIS AND CASH INDEX SUMMARY:

The national average basis for corn was 1 cent stronger at 19 cents under the December futures contract while the DTN National Corn Index was down 6 cents at $3.98. The national average basis for soybeans was unchanged at 52 cents under the January futures contract while the DTN National Soybean Index was up 6 cents at $11.00. 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 down 7 cents at $5.28. The national average basis for HRS wheat was unchanged at 25 cents under the December futures contract while the DTN National Hard Red Spring Wheat Index was down 6 cents at $5.30.

	DTN Cash	Change From	National	Contract	Change from
Commodity	Index	Prev Day	Avg. Basis	Month	Prev Day
Corn:	$3.98	-$0.06	-$0.19	Dec	$0.002
Soybeans:	$11.00	$0.06	-$0.52	Jan	-$0.004
SRW Wheat:	$5.69	-$0.10	-$0.29	Dec	$0.008
HRW Wheat:	$5.28	-$0.07	-$0.26	Dec	$0.001
HRS Wheat:	$5.30	-$0.06	-$0.25	Dec	$0.004

CORN:

The national average corn basis for Wednesday is at 19 cents under the December futures, 1 cent stronger than Tuesday's basis. December corn ran out of steam after Tuesday's surge and ended Wednesday lower, down 5 3/4 cents. As corn harvest nears the finish line (well ahead of last year for some states), the market will focus on South America where there is rain in the forecast for Brazil and Argentina, though expected amounts are less than normal. DTN Senior Ag Meteorologist Bryce Anderson said in a blog that precipitation over the next 10 days offers only limited crop moisture benefit for most of Brazil's production areas. Given USDA's surprising lower U.S. ending stocks estimate for 2020-21, should that come to fruition and if South American crops are affected by poor weather, we could see higher corn prices remain. The track Pacific Northwest basis was steady, while CIF NOLA basis was 2 cents weaker. Some river terminals in the Upper Mississippi River have posted stronger bids as we are getting closer to the winter closure there. BNSF secondary shuttle freight is lower again with last-half November bid at $50 above car above tariff against offers of $250. First-half December is bid at +150 per car against offers of $400. UP secondary freight is bid at $200 per car above tariff against offers of $400.

SOYBEANS:

The national average soybean basis for Wednesday is at 52 cents under the January futures, unchanged from Tuesday's basis. January soybeans closed up 6 1/2 cents as the market is still feeling that the latest USDA ending stocks figure may go lower still if the pace of exports to China continues. Soybeans also found strength in the sharply higher soybean oil futures, up $1.07, with December hitting its highest trade since the end of 2016. Besides strong crush margins, world vegetable oil prices are strong as demand continues to drive prices. Malaysian palm oil prices are at near-eight-year highs after the Nov. 10 Malaysian Palm Oil Board report showing palm oil inventories in October falling to their lowest in more than three years. The soybean basis for track PNW shuttles is 5 cents weaker for December, with no bid posted for the rest of November. The CIF NOLA basis was 5 cents weaker for November, and the St. Louis rail basis weakened again, down 5 cents. Barge freight is still high priced for this week and empty barges are scarce, but expectations are they will be more available next week. That will depend on dredging activity in the Lower Mississippi River, which is causing intermittent closures. By the end of this week, river levels at St. Louis and Memphis are expected to be lower, with Memphis nearing zero gauge again.

SOFT RED WINTER WHEAT:

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

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Wednesday is at 26 cents under the Kansas City December futures, unchanged from Tuesday's basis. The KC December futures closed down 7 1/2 cents, following the lower corn market. The milling premiums for lower proteins was stronger on the KC spot market with 11.4% through 11.6% proteins up 15 cents and 11.8% up 3 cents. It is interesting to note that the flat price of 11.5% (PNW) and 13% (milling) protein is about 15-20 cents higher than 14% protein spring wheat. Overall, winter wheat remains too expensive for export business and eventually that could push the market lower.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Wednesday is at 25 cents under the Minneapolis December futures, unchanged from Tuesday'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 up 10 cents to unchanged at +115* to +135; 14.5% proteins were down 30 cents to down 15 cents at +100 to +115*; 15% proteins were down 45 cents to unchanged at +125A to +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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