DTN Daily Basis Comments

Monday 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 1 cent weaker at 6 cents over the July futures contract while the DTN National Corn Index was up 21 cents at $6.61. The national average basis for soybeans was 5 cents stronger at 33 cents under the July futures contract while the DTN National Soybean Index was up 71 cents at $13.63. The national average basis for HRW wheat was unchanged at 15 cents under the July futures contract while the DTN National Hard Red Winter Wheat Index was up 21 cents at $5.91. The national average basis for HRS wheat was 1 cent weaker at 32 cents under the July futures contract while the DTN National Hard Red Spring Wheat Index was up 11 cents at $7.31.

DTN Cash Change From National Contract Change from
Commodity Index Prev Day Avg. Basis Month Prev Day
Corn: $6.61 $0.21 $0.06 Jul -$0.010
Soybeans: $13.63 $0.71 -$0.33 Jul $0.045
SRW Wheat: $6.39 $0.23 -$0.24 Jul -$0.007
HRW Wheat: $5.91 $0.21 -$0.15 Jul -$0.005
HRS Wheat: $7.31 $0.11 -$0.32 Jul -$0.005

CORN:

The national average corn basis for Friday is at 7 cents over the July futures, 1 cent weaker than Thursday's basis. The July corn market staged a recovery after Thursday's limit-down move, closing up 22 1/4 cents at $6.55 1/4. For the week, July corn was down 29 1/4 cents and December corn was down 43 1/2 cents. Weather remains a key issue for corn going forward as drought spreads across the upper U.S. Midwest, but so far, the market hasn't hung on to that yet. Crop ratings for U.S corn declined for the week ended June 13 to 68%, 4 percentage points lower from the prior week. States that showed notable declines in crop ratings were Minnesota, Wisconsin and Iowa, which are all in some form of drought. In Argentina, the Buenos Aires Grain Exchange said late Thursday 42% of the corn crop was harvested and estimating the crop at 48.0 million metric tons (mmt), slightly above the recent USDA's 47.0 mmt estimate. Shuttle basis on the Pacific Northwest is still unchanged, last half November forward and track St. Louis was 1 cent weaker. Basis was mostly steady in the Midwest with a few ethanol plants pushing for spot corn. Plant margins are not as strong as last month, but still remain steady. Secondary shuttle basis is still bid and offered under tariff through September and Oct/Nov/Dec package is cheaper and now bid at $300 over tariff per car against offers of $400.

SOYBEANS:

The national average soybean basis for Friday is at 33 cents under the July futures, 5 cents stronger than Thursday's basis. July soybean futures closed up 66 1/4 cents at $13.96 cents after the dismal losses on Thursday, as buyers came in looking for a bargain Friday. July soybean oil was up 1.55 cents Friday, unable to find its way back from the 5.5 cent limit-down move seen in most of the contracts Thursday. That market has been falling lower, and pulling soybeans with it, on news that refiners may be given a lower Renewable Fuel Standards blending mandate after complaining RINs were too expensive so far this year. That is, until this past week when that news drove ethanol and biomass diesel RINS to over three-month lows. For the week, July soybeans closed down $1.12 1/2 cents and November soybeans were down $1.25 3/4 cents. Processor basis is steady, but some plants have pushed for nearby beans given the sharp loss in soybeans over the week. Barge freight is still moving lower and demand is pretty nonexistent, with river basis mostly lower above St. Louis. River conditions are in fair shape with low water plaguing the Upper Mississippi and the tropical storm dropping rain over Louisiana and north, adding water to the river at Baton Rouge, but nothing to spark safety protocols.

SOFT RED WINTER WHEAT:

The national average SRW wheat basis for Friday is at 24 cents under the July futures, 1 cent weaker than Thursday's basis. Kansas City July wheat was up 21 1/4 cents and for the week, July KC wheat closed down 31 1/2 cents. U.S. winter wheat harvest is rolling along with merchandisers noting that harvest is in southwest Kansas to Abilene and heading as far north as I70 over the weekend. So far, talk is that yields are excellent and with protein running 8% to mid-11%. There has been little new-crop showing for sale on the KC spot market and much of it so far is working into feed channels. Friday's KC spot market showed protein premiums up 5 cents for 12% through 12.6%.

HARD RED WINTER WHEAT:

The national average HRW wheat basis for Friday is at 15 cents under the Kansas City July futures, unchanged from Thursday's basis.

HARD RED SPRING WHEAT:

The national average HRS wheat basis for Friday is at 32 cents under the Minneapolis July futures, 1 cent weaker than Thursday'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 down 35 cents to down 5 cents at +95 to +125; 14.5% proteins were unchanged at +100N and 15% proteins were down 45 cents to unchanged at +120 to +165. Receipts were 46 cars, which included zero train(s).* (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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