Wright Team
- Oct 11, 2022
- 3 min read

Highlights, Markets & Rain Days Update 10/11/22

Highlights

Crop Progress Report this afternoon and USDA Crop Production and S&D 11 AM Central tomorrow.

The corn to bean ratio is normally 2.4:1, meaning it takes 2.4 bushels of corn to equal the value of one bushel of beans. This morning, the March corn to March soybean ratio is 1.98:1, which means corn is way to expensive or beans are way too cheap.

A backup of more than 2,000 boats and barges on the Mississippi River began moving Sunday as two closures along the waterway reopened near Stack Island, Mississippi and near Memphis, Tennessee.

One of the 12 US railroad unions voted against the tentative national agreement. Only 4 unions have ratified the agreement thus far. If two unions reject the agreement, the deal is dead and back to the negotiating table. With the Mississippi problems, a rail strike would be ugly for basis and the price of grain storage will go through to the moon.

There is a futures contract to trade the soybean crush margin. The January contract made a new high yesterday before closing lower than the previous day’s low, forming a key reversal lower.

China’s Golden Week holiday ended last Friday. Yesterday, China’s hog futures were up 5.8%, the biggest daily gain since the contract was launched last year. China’s #2 soybeans (#2 are imported, #1 are domestically grown) were up 54½ cents, soymeal up US$1.00, and soyoil up $1.84 per cwt.

Brazil is the world’s #2 corn exporter. The Port of Paranagua shipped 11.3 times more corn this past September than a year ago. Why? Brazil’s 2021 corn crop was poor and this year’s drought in Western Europe, war in Ukraine (#4 corn exporter) and low river water in Argentina (#3 corn exporter) and USA (#1 corn exporter) means Brazil gets the world’s corn business.

AgRural estimates Brazil’s soybean planting at 9.6% complete, slightly below last year’s pace.

Argentina’s corn crop is 13% planted, 11% behind a year ago; it is delayed by dry weather.

Russian missiles hit civilian targets multiple cities yesterday and today, including the capital city of Kyiv, and also energy facilities.

Britain’s agriculture ministry says England’s wheat production is up 12% more than a year ago at 14.4 million mt and barley is up 6.6% to 5.2 million mt.

Safras & Mercado estimate Brazilian farmers have sold 19% of their new crop soybeans vs 30% average, and 86% old crop beans vs 91% average.

Roger has said for decades a farmer does not need a futures trading account to do a great job marketing his production, but, in order to do a great job marketing his cash grain, a farmer must understand how the futures and option markets work. However, a great cash grain marketer with a futures trading account can do even a better job marketing his grain.

A perfect example: Yesterday, two farmers called when beans were up 30+ cents. Both had to take soybeans to town. Both thought soybeans would be higher into the end of the year. Roger told both he expected beans to correct lower 10 to 20 cents (at least) before Wednesday’s USDA Crop Production and S&D Reports. One had a futures trading account the other did not and never will. The one with the futures account sold cash beans up 31 cents and was going to wait to re-own beans “on paper” after a correction lower. The farmer without the futures account put the beans on a January basis contract. On the close, beans were up 7 cents, 24¾ cents below the day’s high. One of those farmers did not lose 20+ cents yesterday; the other did.

Market Update

This morning:

Crude oil is at $89.82, down $1.31

The dollar index is at 113.17, up 0.03

December palm oil is at 3,746 MYR, down 91. The contract high was made April, 29th at 6,384 MYR. Palm oil owns 36% and soybean oil owns 28% world market share.

December cotton is at $87.39, down $0.84 per cwt. The contract high was made May, 17th at $133.79 per cwt. Cotton competes with soybeans and corn for acres.

December natural gas is at $6.881, up 0.097. The contract high was made August, 23rd at $10.119. Natural gas is the primary cost to manufacture nitrogen fertilizer.

December ULSD is at $3.5590 per gallon, down 0.1313. The contract high was made June, 17th at $4.0719. ULSD stands for Ultra Low Sulfur Diesel.

December Dow Futures is at 29,1535 down 125. The lifetime high is 36,832 on January 5th, 2022.