US – March Corn finished up 1/4 at 729 1/2, 3 off the high and 2 up from the low. May Corn closed up 3/4 at 730. This was 2 3/4 up from the low and 1 3/4 off the high.
March corn finished the day nearly unchanged and the December 2013 contract saw modest losses. Traders noted active bull spreading throughout the day with old crop corn seeing support vs. new crop corn.
Positive export demand data yesterday was seen as short term supportive to the market along with thoughts that domestic ethanol margins have improved.
Public data shows that Iowa Ethanol Margins have jumped to -30 cents per bushel vs. -58 the week prior. Strong ethanol prices and a jump in DDG values helped to boost margins but this was the 26th consecutive week of negative margins for the state.
Valero Energy Corporation stated that they have idled 3 of its 10 ethanol plants during the final 3 months of 2012 due to high corn prices and high ethanol inventories.
In addition, an ethanol plant in Plainview, Texas announced this afternoon that it would idle production due to higher corn prices.
The setback in ethanol and export demand continue to suggest that demand is being rationed but feed demand remains unknown until the March stocks report.
March Rice finished up 0.175 at 15.525, equal to the high and 0.205 up from the low.
Soy Futures Closed Higher
March Soybeans finished up 3 1/4 at 1451, 7 off the high and 10 up from the low. November Soybeans closed up 2 at 1312. This was 6 1/2 up from the low and 6 3/4 off the high.
March Soymeal closed up 3.4 at 423.7. This was 5.7 up from the low and 0.8 off the high.
March Soybean Oil finished down 0.18 at 51.71, 0.54 off the high and 0.05 up from the low.
March soybeans traded higher on the day as the weather forecast for Argentina turned drier in the 10 day outlook but wetter for most of Brazil.
Showers favor northern Brazil this week which could delay harvest in some regions. Showers will shift to the south in the 10 day outlook which should help the condition of the soybean crop after trending drier in early January.
The vessel lineup is beginning to stack up in the ports of Brazil as shippers await new crop supplies.
Delays to the harvest and supply chain disruptions are seen as short term positive forces in the market. The basis in the Gulf of Mexico was steady to firm midday on spot demand.
Some traders suggest that if delays continue to occur in South America, demand could shift back to the US border which could be viewed as bullish given the tight US stocks to usage ratio of 4.4 per cent.
Wheat Futures Closed Lower
March Wheat finished down 2 1/4 at 777, 8 off the high and 1 up from the low. May Wheat closed down 2 1/4 at 785 3/4. This was 3/4 up from the low and 8 off the high.
KC and Chicago wheat traded slightly lower into the closing bell on thoughts that export demand may not pick up enough to hit the current USDA export estimate for this crop years.
Comments by Egypt’s head wheat buyer late in the session suggesting domestic stocks were healthy until June 22nd may have added some late profit taking to the market.
Yesterday’s crop conditions ratings showed additional deterioration for the wheat crop in the western plains. Kansas was rated 20 per cent Good/Excellent vs. 24 per cent at the end of December.
Poor/Very Poor conditions were pegged at 34 per cent and the report stated that no areas of the state had received over an inch of moisture in the last month.
Light rainfall was moving across the western plains this afternoon but accumulation was expected to be light. None the less, the rainfall is needed and welcome.
The weather outlook for the eastern Corn Belt continues to suggest favorable conditions and moisture levels which should help promote a solid foundation of growth for the Chicago wheat crop once it comes out of dormancy.
March Oats closed down 1 1/4 at 360. This was 2 1/2 up from the low and 1 1/2 off the high.