Positive week for the markets - 12/17/2021

Dec 17, 2021

Positive week for the markets - 12/17/2021

Ed Nienaber
Vice President, Grain Division

The in market has the holiday spirit as we close in on a very positive week. Soybeans are trading up some twenty-five gracents and corn is trading a dime higher on the week. Export inspections were better than anticipated and we continue to see buying going into the next two weeks of holiday trading. Both ethanol and crush margins continue to be strong, however, it feels as if the local processor has very good coverage going into the new year. Many eyes are beginning to focus on the USDA January 12th supply/demand report, as we will get final numbers for the 2021 harvest and begin to analysis the carry-over figures. This report in past year is always much anticipated and generally is a market mover. With the increase in input cost on corn we are already seeing price support on new crop futures as market works to buy acres for this coming spring plantings. This and the southern hemisphere production will be major topics of market concern in the coming months. Enjoy the holidays with family and friends, continue to be safe and have a very Merry Christmas and Happy New Year!

Wes Bahan
Director of Grain Purchasing

Good afternoon.  I sure hope that everyone enjoyed the warm weather this week, I sure know I did.  We sure did see some excitement in the markets to end the week.  The bean market broke out of its month-long trading range but seemed to fail as we approached $13.00 futures.  Nothing changed fundamentally to really stand out as a reasoning.  NOPA crush from November was well below estimates, export sales and shipments aren’t anything spectacular, and as we get into January Brazilian beans are cheaper than US beans.  With soybean crush margins so good, how did we not crush above expectations??  We did see a lot of beans change hands to end the week, so farmers were active sellers on the rally as they should be.  Corn preformed in about the same manner with a nice rally, trading just above the current range and faltering there.  There was also a lot of corn movement to end the week.  This should allow the ethanol makers the ability to bridge the gap from the holidays to the first of the year and will likely cause basis to set back as movement will be heavy.  This will be the last commentary for the year as the next couple weeks are short.  I wish all of you and your families a happy and joyous holiday season. 
Lisa Warne
Grain Origination, Mechanicsburg (Region 3)

Exports are still strong but could soon drop off with reports of South America having an early harvest.  Markets have had wide swings throughout the week but looks to be close to what they were a week ago with much of it being end of year squaring on positions.  The next couple of weeks will be short trading weeks it might not hurt to put targets in above the market because of the volatility in the thin holiday trading. Heritage will be closed December 24th and December 31st for the holidays. Everyone have a Merry Christmas & Happy New year!

Ralph Wince
Grain Merchandiser, Canfield (Region 5)

Good Afternoon, the corn & bean markets have had some strength to them this week. Although beans are off their highs today it does appear that we will close somewhere around .20 cents higher for the week and corn looks to close near its resistance level of 5.92 on the CBOT. One has to wonder if we are seeing some outside money flow into the market this week. I have not heard confirmation of that but we continue to hear talk of outside money being shifted from stocks to commodities with the concern of inflation. We continue to hear more about inflation on a weekly basis and this morning the European Union announced that last month inflation hit a record high of 4.9%. We continue to either see no carry or very little carry being put into the corn market and that makes no sense at all considering that USDA has the corn carryout sitting at 1.493 billion bushels. One has to wonder what will change in the marketplace as we march forward. Will basis get stronger? Will we put carry back into the market? We are seeing a few areas in South America showing some dryness. It is not a big area yet but it does warrant watching. We are seeing good export numbers for beans over the last couple of weeks and the CIF market is trying to encourage bean sales at the front end of the market. I hope each of you has a wonderful Christmas and a very Happy New Year. It will be a couple of weeks till we write again. Take care and Merry Christmas to all of you!!!!!

Haylee VanScoy
Grain Merchandiser, Upper Sandusky (Region 2)

Can’t believe Christmas is only a week away! Grain markets have attempted to hand out some early Christmas presents this week with nearly a 50c rally in nearby beans and a modest gain in corn. We’ve started to see a little risk premium added into the market on potential dryness in the coming weeks for parts of South America. We’ve also seen some support as China purchased 132,000 MT of soybeans this week and meal demand has been staying strong. The corn market has also seen strong ethanol production and export sales this week, however we’re running into resistance levels on nearby corn and beans. Mar 22 corn is having a hard time pushing through 6.00 futures and 13.00 on Jan 22 beans. Expecting a somewhat quiet week next week as the holidays approach with limited direction until the Jan 12th Supply and Demand report. Don’t forget to call with target offers for us to watch while you’re spending time with your families over the coming weeks! Hope everyone has a safe and blessed Christmas and New Year! 

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