The grain markets had a good week, with prices up across the board. March corn prices were up 3¢, with December corn prices were flat and March soybean prices were up nearly 11¢ for the week ending Feb. 10, with new-crop soybeans up nearly 9¢. Wheat prices were up 4¢ to 30¢, depending on the contract.
“This week we went from a neutral week on Thursday and suddenly on Friday we get a 10¢ rally in corn and 30¢ in wheat, and things look differently at the end of the week,” says Jerry Gulke, president of Gulke Group.
At play in the wheat market, he says, is a cold forecast in the Midwest, a shortage of high-quality milling wheat and continued unrest in Russia and Ukraine.
“The whole market kind of changed overnight and just showed you what political atmosphere we’re in,” Gulke says. “Seasoned traders have always said you want to watch February trade. If it can exceed the January trade, then you’re on to something. We’re very close to those areas now. Of course, we aren’t at the end of February yet, but that’s something to watch.”
WASDE Report Recap
On Wednesday, Feb. 8, USDA released its monthly World Agricultural Supply and Demand Estimates (WASDE) report.
For corn, USDA calls for lower corn used for ethanol and larger ending stocks. The season-average corn price received by producers is unchanged at $6.70 per bushel.
For soybeans, USDA calls lower soybean crush and higher ending stocks. The U.S. season-average soybean price for 2022/23 is forecast at $14.30 per bushel, up 10¢ from last month.
“In soybeans, USDA did lower the crush 15 million bushels, and they added right onto the bottom line; they didn’t touch the exports,” Gulke says.
For corn, he says the surprise was USDA didn’t touch exports.
“We all know we’re well behind last year’s export sales so the question is how and when or if the government will reconcile the fact that we can’t get there from here,” Gulke says. “The report said the USDA is still hopeful!”
Additionally, USDA did lower Argentina’s corn and soybean production forecast.
Weather Watch
Looking ahead, Gulke says the market will be focused on weather.
“We saw a cold spell last October and another one in December that really shocked the nation,” he says. “There looks to be one coming next week in the U.S. But the one we’re really looking at would be at the end of March and in April, where we could see another cold spell that could dip into the frost and freeze area that maybe could finally affect.”
At the Gulke Group conference next week in Palm Spring, Calif., Gulke says World Weather’s Drew Lerner will provide his take on the upcoming weather.
“Now we’re in the season where we’re going to be looking at spring weather,” Gulke says. “Is there going to be cold and wet in April or will we get an early start? Will we get the crop in early or on time? How will we set the stage for the 2023 crop?”
Read More
Jerry Gulke: Do the Negatives Outweigh the Positives in Grain Price Outlook?
Jerry Gulke: Did the USDA Reports Create A New Paradigm Shift in Grain Prices?
Check the latest market prices in AgWeb’s Commodity Markets Center.
Jerry Gulke farms in Illinois and North Dakota. He is president of Gulke Group Advisory Services.
Learn more at GulkeGroup.com
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