Mark's Market Talk
Feb 13, 2023
It appears that corn and beans are fully rangebound as traders search for direction. Last week we had the normal up and down days, but at the end of the week we had not gone very far. March corn ended the week 3 cents higher while the December contract was steady. We did see a little advancement in beans as the March contract finished 10 cents higher and the Nov was 9 cents higher. Wheat was the weekly leader as the Chicago and KC wheat was 30 to 36 higher. Talk of an increase of fighting in the Ukraine led this. The war is nearing the one-year anniversary and some think Russia will soon mount an offensive to try and end it. However, Ukraine is not backing down and with the increase of help from other countries a quick resolve does not look to be in the cards. The bean market continues to be influenced by the dry weather in Argentina and the slow harvest progress in Brazil. China continues to buy some nearby beans from the US when normally they would be getting all they want from Brazil at this time of year. This strength is on borrowed time as Brazilian beans will become readily available and they are currently 75 cents cheaper then our beans into China. Local basis levels have cooled off considerably as interior processors have bought amble supplies to keep their plants full. Decent trucking weather is allowing farmers to haul almost at will which is not always the case this time of the year. This may lead to better basis levels in March if the farmer can get his beans delivered in February. Corn prices remain ho-hum. Poor export sales are weighing on the optimism of traders. They are still somewhat long on corn contracts and if we don’t start seeing some decent export sales, they may start liquidating some positions and find a better place for their money. The corn market needs a spark as we head toward our planting season, particularly new crop prices. We are approaching the time of year we may see an acre war as corn and beans fight over some undecided acres. It may not be very intense this year as cotton will not be a big player due to depressed prices. Spring wheat is normally not an influence, but world issues may lead to some competition this year. We will take any help we can get as the Brazilian bean crop will have a long tail and will probably inflict some price damage on us. On the flip side the delayed planting of their safrina corn crop along with a stepped-up war in Ukraine may help light a spark under our corn prices. As always, we have lots to think about and it all changes week to week.