DTN Daily Basis Comments

Friday 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 13 cents under the May futures contract while the DTN National Corn Index was down 3 cents at $5.20. The national average basis for soybeans was unchanged at 37 cents under the May futures contract while the DTN National Soybean Index was up 3 cents at $13.74. The national average basis for HRW wheat was 1 cent stronger at 26 cents under the May futures contract while the DTN National Hard Red Winter Wheat Index was down 5 cents at $5.95. The national average basis for HRS wheat was 1 cent weaker at 33 cents under the May futures contract while the DTN National Hard Red Spring Wheat Index was unchanged at $6.11.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $5.20 -$0.03 -$0.13 May $0.002
Soybeans: $13.74 $0.03 -$0.37 May $0.004
SRW Wheat: $6.29 -$0.04 -$0.22 May $0.008
HRW Wheat: $5.95 -$0.05 -$0.26 May $0.003
HRS Wheat: $6.11 $0.00 -$0.33 May -$0.002

CORN:

The national average corn basis for Thursday is at 13 cents under the May futures, unchanged from Wednesday's basis. May corn futures closed down 2 3/4 cents, unable to sustain gains earlier in the day as weekly exports sales and shipments report was bearish, because we haven't seen any new sales for a while. Near the close, CNBC.com reported that Fed Chairman Jerome Powell repeated that the Fed intends to be patient about changing policy and is willing to tolerant moderate inflation. Those comments sent the U.S. dollar higher and in turn pushed corn and winter wheat markets lower in the close. Corn may find support if the second corn crop in Brazil continues to be delayed. Track Pacific Northwest shuttle basis was steady, while CIF NOLA basis was 2 cents weaker. Secondary shuttle freight for March is bid $200 per car over tariff for first half and $150 per car over and April is bid at $50 under against offers of $100 over. Ethanol plants are seeing precontracted corn moving at a brisk pace with some plants reporting long lines.

SOYBEANS:

The national average soybean basis for Thursday is at 37 cents under the May futures, unchanged from Wednesday's basis. May soybean futures closed up 3 cents, while soybean oil continues to be the lead in the complex, with May up 93 cents. The surge in crude oil Thursday was supportive, but the market is concerned over the tight supply of U.S. soybeans may cause a crush slowdown. Soybean meal was down $2.20 in part due to the continued concern in over the return of African swine fever in China and how that will affect their feed demand. All eyes continue to be on Brazil and Argentina crops and late Thursday, the Buenos Aires Grain Exchange said 20% of the soybean crop was rated poor or very poor, up from 15% the previous week, while drought was reported as a concern in 10 of Argentina's 15 districts. Track PNW shuttle basis for posted bids in September was 2 cents weaker, while track St. Louis and CIF NOLA basis was 1 cent stronger. There is still a slowdown on the Ohio River due to flooding, but barges are allowed to transit southbound no during daylight only hours. The next concern is at Baton Rouge where the Mississippi River continues to rise and is expected to hover at flood stage in the coming week. More rain could cause issues eventually at the Gulf.

SOFT RED WINTER WHEAT:

The national average SRW wheat basis for Thursday is at 22 cents under the May futures, 1 cent stronger than Wednesday's basis.

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Thursday is at 26 cents under the Kansas City May futures, 1 cent stronger than Wednesday's basis. The KC May futures were down 5 cents, under pressure from the weakness in corn and the higher U.S. dollar. The KC spot milling premiums took a hit as mills have seen March contracts shipping at a steady pace. Ordinary protein through 11.2% was 8 cents weaker and 11.4% through 14% was 10 cents weaker. The improvement in truck and rail logistics is causing wheat to move at a decent pace now, causing the mills to get their fill and then some.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Thursday is at 33 cents under the Minneapolis May futures, 1 cent weaker Wednesday's basis. The Minneapolis spot spring wheat cash market closed as follows, basis the Minneapolis May futures contract for No. 1 milling quality: 12% proteins were not quoted; 13% proteins were not quoted; 13.5% proteins were down 10 cents at +110*; 14% proteins were down 10 cents at +110*; 14.5% proteins were unchanged to down 10 cents at +105N to +110; 15% proteins were unchanged at +130N. Receipts were 73 cars, which included two 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

Mary Kennedy

Mary Kennedy
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