Apr 17, 2014
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Cash Grain Insights

RSS By: Kevin McNew, AgWeb.com

Kevin McNew is President of Grain Hedge and Geograin. McNew was raised on a farm in central Oklahoma and received his bachelor’s degree from Oklahoma State University, and master’s and Ph.D. degrees in Economics from North Carolina State University. For over a decade, he was a Professor of Economics at the University of Maryland and Montana State University, focusing on commodity markets. He has received numerous academic awards for his research and outreach work, and was (and still is) widely regarded for boiling down complex economic issues into easy-to-understand concepts for applied life.

 

Will Wheat Find New Export Biz

Jan 15, 2014

 Soybeans held on to slim gains overnight after another round of higher prices on Tuesday. Corn and wheat continued to struggle with modest losses of 3 and 1 cent respectively.

For beans, prices have rallied to their highest level since Christmas, but seem to be lacking conviction to the upside. After trading as high as $13.16 in Tuesday’s day trade for March futures, prices have fallen back and consolidated around the $13.07 level. Today brings the NOPA monthly crush report for December with traders expecting a 2.3% increase over November with an average estimate of 163.9 MB and a range of expectations from 160 to 166.5 MB.

price platform service box

In corn, basis levels continue to move lower with Decatur posting a 4-day in a row of lower basis quotes. Since Friday’s report, spot basis in Decatur is off 23 cents a bushel. Overnight, South Korea's largest animal feed maker Nonghyup Feed Inc. (NOFI) issued an international tender to buy up to 140,000 MT of corn and 70,000 MT of feed wheat. The tender deadline is Thursday, Jan. 16, with optional worldwide origin sought for May arrival.

For wheat, the recent slide in US futures prices has some buyers looking for new supplies. Brazil mills are rumored to be seeking US HRW, and with Argentina only shipping 500,000 MT of wheat in the near term this could spell more business for the US.  Further, Argentina wheat is reported to be $50/MT higher than US HRW wheat, which could fuel more buying from the US. Overnight, French government officials projected 2013/14 soft wheat ending stocks at 2.7 MMT, up from 2.4 MMT seen last month, while exports were cut from 11.8 MMT in December to 11.5 MMT in January. Meanwhile, Ukraine raised its overall grain harvest projection for 2013 to 62.9 MMT, up from 46.2 MMT in 2012. 

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