Category: Gold News

Today’s Grain Market Update – Northern Ag Network

By Published On: April 11, 20243.7 min readViews: 1090 Comments on Today’s Grain Market Update – Northern Ag Network
DTN reports:

In slow early trade Wednesday, all three wheat markets moved sharply higher by the closing bell. There was little in the way of fresh news to drive the markets other than some weather concerns. Warm and mostly dry conditions are expected in the U.S. southern Plains and Black Sea wheat areas, including southern Russia. Corn bounced in quiet trade while soybeans, soymeal and bean oil shrugged off early weakness to finish with solid gains.

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Wheat markets rose in unison on Wednesday with not a whole lot of news attributed to the strength. There is some concern over a drier pattern in the U.S. southwest and warmth and dryness in Black Sea wheat regions along with a continued very wet pattern in Europe. However, other than that, it is likely just some short covering from oversold conditions and as funds remain short wheat.

Some of the strength can be attributed to rising world wheat values especially from No. 1 exporter, Russia. FOB values from that country have risen over $10 mt, with Russian FOB now at $209/mt. Ukraine also continues to be a factor in world wheat having managed to ship 14 mmt in the current crop year from July to June. Recent strength in the U.S. Dollar Index, which hit a six-month high Tuesday has been a weight on the wheat market.

On Wednesday, the dollar corrected a bit to the downside. Wheat tender activity saw Jordan pass on its typical 120,000 mt tender amount, while Japan is seeking a combination of 114,000 mt of U.S. Canadian or Aussie wheat, and Tunisia is looking for offers on 50,000 mt of soft wheat. U.S. winter wheat conditions remain far above that of a year ago, but the outlook could turn warmer and much drier in the weeks ahead. In the spring wheat belt, moisture has been plentiful in the past week, but just 1% of spring wheat has been planted so far. Funds remain short a good chunk of both KC and Chicago wheat, with the latter position estimated to be near 90,000 contracts. DTN’s National HRW index closed at $5.17, 46 cents below the May contract.

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Corn futures moved higher in light trade after the first two days of the week took away much of the grain from last Thursday’s low USDA stocks and acres numbers. Trade was uninspiring and likely just corrective action from early week losses. It is becoming clear that corn traders are unwilling to agree with USDA’s contention that farmers will plant 4.6 million fewer acres than a year ago despite low prices and increased costs. Corn demand remains good, with export sales commitments up 19% from a year ago and inspections running 33% higher. Mexico has pretty much carried U.S. corn exporters with their brisk buying pace, while China is reportedly trying to slow shipments of imported corn to boost prices for farmers ahead of planting.

Domestically, ethanol producers have been going strong, with another stout production of 1.073 million barrels per day produced in the week ending March 29. Ethanol production has been running at a clip that is more than 5% higher than a year ago, with last week’s production a hefty 1.073 million barrels per day. Some pressure continues to weigh on corn from news of bird flu infecting chickens in Texas and Michigan. As a result, the No. 1 egg producer in the U.S. culled 3.6% of its total flock.

In Brazil, weather continues to be favorable in Mato Grosso and central and northern Brazil, while there is some concern in southern Brazil where drought conditions have expanded. Argentina still looks on pace to double last year’s drought-ravaged corn production. The U.S. ag attache in Brazil lowered ideas on Brazil’s corn production to 122 million metric tons (mmt) for 2023-24, while raising 2024-25 anticipated production to 129 mmt. The USDA remains 2 mmt above the attache, while both CONAB and private crop scouts have corn production down near 112 to 113 mmt. On corn tender news, Taiwan’s MFIG bought 65,000 metric tons (mt) of corn from Argentina and Iran is tendering for 120,000 mt of optional corn along with the same amount of soymeal. Corn is likely getting a bit of an energy-related boost from a crude oil market that saw the spot month exceed $86 per barrel as tensions rise in the Middle East. Funds are still long, close to 250,000 contracts of corn still. DTN’s National Corn Index closed at $4.04, and 22 cents under the May contract.

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