Weekly Crop Commentary - 10/28/2022

Oct 28, 2022

Ed Nienaber
Vice President, Grain Division

The grain markets have traded, for the most part this week, on both sides of unchanged. However, as we attempt to finish the week, we are seeing corn down a nickel and beans off close to twenty-five cents for the week. Harvest pressure, weaker dollar, and reduced export concerns are weighing on future prices. Most if not all conversation continues to be overall concern with logistics as we move into November. Low water levels on our river system, barge freight at record levels, continued unit-train bottlenecks and concern over possible rail workers strike mid-November is causing uneasiness in the commodity markets. Bean harvest is pushing 80% completed, while corn is in the neighborhood of 40% in the books. We do have some much-needed rain in the forecast for early next week, but then things look to clear up for another decent week of harvesting. The western harvest is about done for the year, and we continue to see unusually high basis levels for both corn and beans as domestic margins are at very good levels. With this work east, only time will tell. The USDA will be releasing updated supply/demand and crop production figures on November 9. We anticipate some adjustments to the carry-over figures. Have a great Halloween weekend and continue to be safe.

Wes Bahan
Director of Grain Purchasing

Good afternoon. We are in the meat of harvest and space is becoming an issue. Transportation woes continue to plague the Midwest. The river system is continuing to deal with historically low water levels causing closures in several areas of the Mississippi River. The rail sector has been behind from the start and once you get behind, there is no recovering, all you can do is damage control. Everyone is doing the best they can to accommodate on space, and yes, it’s going to be a battle to the end now. Especially hearing the news that now a second rail union has rejected the contract deal from the Class I railroads. If the groups cannot come to an agreement by November 19th the unions will strike. If this happens it will be catastrophic to the entire transportation sector. If that wasn’t enough good news in this week’s energy report, we were told that diesel fuel supply is not a 25 days’ worth of inventories. Hold onto your hats folks, it’s going to be a bumpy ride. 
Happy Halloween 

Haylee VanScoy
Grain Merchandiser, Upper Sandusky (Region 2)

Can’t believe it’s the end of October already. Harvest is rock’n and roll’n with beans all but finished up in many areas and corn nearing 40% complete. November beans have been trying to recover this week from Monday’s losses, but overall, a pretty range-bound month for the bean market compared to the extreme volatility seen over past months. December corn is in a similar boat holding close to its 50-day moving average. A lack of new news this week has resulted in a relatively quiet market that makes you wonder, is this the calm before the storm? Barge freight is still high, river levels are still low, export sales aren’t anything exceptional, and geopolitical tensions continue to brew. Over the next couple weeks, we will continue to keep an eye on the Ukraine grain export corridor and the US tentative rail agreement, as another rail union has rejected it this week. Next week, we will also see the Feds come out with their next rate hike, which is expected to be at least 75 basis points. Hope you have a great weekend! Stay safe out there if you’re in the fields or taking the kiddos trick or treating!

Lisa Warne
Grain Merchandiser, Marysville (Region 4)

Happy Halloween weekend! Some rainfall early in the week slowed things down briefly, but it’s been nonstop here to finish the week. Region 3 which includes West Liberty, DeGraff, Urbana, Fletcher, Thackery, and Mechanicsburg is nearing the end of soybeans with 90% of our estimated bushels received. Region 4 (Marysville, Richwood, and Derby) is sitting about 75% done. Corn for both regions is at 45% complete. As we move through the thick of harvest, space gets tighter, and we become more dependent on train movements. We appreciate your patience if we need to limit receiving hours for certain commodities.
Speaking of rail movements, the threat of a railroad worker strike still exists on the horizon. A second union has voted to reject the tentative deal made in September. There is a deadline for an agreement in mid-November, so the clock is ticking. With Mississippi River levels still low, a rail strike would cripple grain movement and exports.
The keyword for the market this week has been “rangebound”. With harvest pressure, extremely poor corn export sales, and a report out of China on poor economic data, the grain market has struggled to find much upside momentum. At midday Friday, corn and beans are both down 3-7 cents on the week while next July wheat is down 20 cents from last Friday. Have a great weekend and please continue to be safe!

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