Weekly Basis 2/5/23
Commitments of Traders report for publication date February 3, 2023, is delayed due to ransomware attack on ION Group, UK. A report will be published somewhat later, we will keep you updated when it resolves.
The Dow Jones Industrial Average (DJIA) settled at 33,926.01, down 52.07 points for the week.
Crude oil settled at $73.23, down $6.15.
The Dollar Index settled at 102.99, up 1.07.
The Baltic Dry Index (a shipping freight-cost index) settled at 621, down 55 for the week.
Below is corn, soybeans and wheat basis outlook this week.
March futures at $6.77½, down 5½¢ for the week.
December futures at $5.96, up 8¾¢.
Basis (H = March; e.g. 10H means 10¢ over March futures) (Futures price + Basis = Cash price)
The US national average basis is 8H, steady.
Dayton, Ohio Cargill’s Spot basis is 6H, 6¢ firmer, $6.84 cash price;
Iowa Falls Poet’s Spot basis is 10H, 5¢ weaker, $6.87 cash price.
Corn Ethanol Crush Margin was $1.68, $1.73 a week ago and $1.24 a year ago.
The price of corn subtracted from the value of processed products = ethanol crush margin.
March futures at $15.32, up 22½¢ for the week.
November futures at $13.69¾, up 18½¢.
Basis (H = March; e.g. -20H means 20¢ under March futures) (Futures price + Basis = Cash price)
The US national average basis is -33H, 2¢ weaker.
Iowa Falls Cargill: Spot basis is -50H, steady, $14.82 cash price;
Sidney, OH Cargill: Spot basis is -5H, 5¢ weaker, $15.27 cash price.
Soybean Crush Margin was $4.04, $3.75 a week ago and $3.24 a year ago.
Crush margin = value of the oil and meal extracted from a bushel of beans minus the cost of a bushel of beans.
Soft Red Winter Wheat (CBOT)
July 2023 futures at $7.71¾, up 11¾¢ for the week.
Basis (N = July, H = March; e.g. -28N means 28¢ under July futures) (Futures price + Basis = Cash price)
The US national average basis is -40H, steady.
Heritage Coop. at Mechanicsburg, OH: July basis is -50N, steady, $7.22 cash price.
Hard Red Winter Wheat (Kansas City BOT)
July 2023 futures at $8.57¾, up 4½¢ for the week.
Basis (N = July; e.g. -40N means 40¢ under July futures) (Futures price + Basis = Cash price)
The US national average basis is -29H, 1¢ firmer.
Producer AG at Canton, KS: July basis is -20N, steady, $8.38 cash price.
Hard Spring Wheat (Minneapolis Grain Exchange)
September 2023 futures at $8.90¾, up 8½¢ for the week.
The US national average basis is -24H, 4¢ weaker.
What you should have noticed
Major decline for Crude Oil, while Dollar Index was confidently higher. And as you know, higher Dollar Index means more expensive US commodities for export. We had a rich comment on it yesterday.
Baltic Index continued to slither, making a new 52-week's low.
Soybeans futures were higher 18¢ & 22¢, justifying 2¢ loss of the national average basis.
Wheat futures got higher as well, the average basis for Hard Spring lost 4 cents.
Crush margin for soybeans got back to $4+ and continued to shrink for corn.
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