Wheat
The wheat market sold off pretty hard the first half of the week with pressure coming from low export shipment numbers and sharp losses in the row crop markets. A Feb. 5 correction in the grain markets helped jump wheat contracts higher and cut weekly losses. In the nearby contracts, for the week, Chicago wheat was down 7.25 cents to $5.6075, Minneapolis was up 5.25 cents to $6.5725, and Kansas City was down 12.5 cents to $5.7875.
Outside markets pressured wheat in the overnight session Feb. 2 and that carried over into day session causing wheat to open with modest losses. USDA released its export inspection report Feb. 2. The report came in bearish for the wheat market. Export inspections showed wheat shipped 11.9 million bushels last week, which is lower than the week before and 3.4 million bushels less than needed to meet expectations. Along with negative export numbers, spillover weakness from corn and soybeans and strength in the dollar were heavily pressuring the wheat market until midday, when it regained strength and pushed higher into the close. The U.S. dollar was the main market mover for wheat during the Feb. 2 session. The dollar was sharply higher overnight and most of the morning but came under pressure near midday and dropped 84 points off of its highs of the day. The big drop in the dollar helped support a late-session rally, but the wheat market was unable to recover all the losses it had incurred during the course of the session. The wheat market closed the session down 4 to 10 cents.
The wheat market opened lower than expected Feb. 3 as pressure was coming from the sharply lower row crop markets. At midday, wheat began to separate itself from corn and soybeans and started to rally higher to near unchanged. Poor export sales and pressure from corn and soybeans were too much for wheat to overcome at the end of the session, and wheat dropped to its lows of the day at the close. Contracts across all three exchanges closed down 6 to 11 cents. The U.S. dollar was sharply lower all session, which provided support for the wheat market and helped to limit losses.
The wheat market opened modestly higher Feb. 4 with support spilling over from the row crop markets. Not even a full hour into the session, pressure from a higher U.S. dollar started to weigh heavily on wheat, causing it to sell off and drop nearly 20 cents from its overnight highs. Forecasts for rain in the southern U.S. continued to push the wheat market lower until midday, as this rain system likely would help the drought stricken southern winter wheat crop. Around midday the dollar began to lose strength and news came out stating a severe drought may be putting China's wheat crop may be in jeopardy, which rallied wheat to near unchanged. At the end of the session, the row crop markets started to sell off and wheat was pressured lower into the close to end with about 10 cents losses.
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After posting gains in the overnight session, the wheat market opened higher Feb. 5 and continued to work higher most of the session. Just before the close, wheat dropped off of its highs but still managed to hang on to near 20-cent gains in all contracts. Buying interest was spurred after the wheat market had worked lower all week. A bullish USDA export sales report contributed to the strength in the wheat market. The report showed that wheat had export sales last week of 12 million bushels, which was higher than the 9.7 million bushels needed to stay on pace with USDA projections for the year. Although wheat sales came in above the required pace, wheat shipments still are lagging behind, as U.S. wheat is overpriced relative to our competitors. News that Russia may be beginning to run low on its wheat supply is encouraging for U.S. wheat exports.
Corn
The corn market had sharp losses early in the week but was able to recover by the end of the week. The corn market opened lower Feb. 2 with March down 6 cents and had double-digit losses by midmorning. The selling pressure eased somewhat later in the day with closing prices down 8 to 9 cents. The higher dollar, lower stock markets and lower crude oil combined to pressure the corn market, while the late selloff in the dollar did little to ease the pressure. The weekly export inspections report put corn shipments at 25.3 million bushels, which was below expectations and below the 35.6 million bushels needed to keep pace with USDA projections.
The corn market opened lower Feb. 3 with March down 4.5 cents and slowly moved lower through the session with closing prices down 8 to 9 cents. The sharply lower dollar and small recoveries in the stock markets should have helped the grain markets, but selling pressure remained firm. Forecasts from Argentina were calling for widespread light rain and cooling temperatures. Near the end of the day, the corn market tested its lows from Jan. 14 but was able to close a few cents higher.
The corn market opened higher Feb. 4 with March up 3 cents, and there was strong buying interest early. The market then backed off throughout the session with closing prices down 3 to 4 cents. The outside markets were supportive early with higher stock markets and a lower dollar, but a reversal in those markets during the day brought pressure into the grain markets. Near-term rain events were reduced in Argentina, but more rain was added to the forecast for later in the week and next week.
The corn market opened higher Feb. 5 with March up 1.75 cents. There was buying interest from commercial and noncommercial traders all day, resulting in closing prices up 12 to 13 cents. The outside markets were mixed early but provided decent support by the end of the day, with most of that support coming from the higher stock markets. There was rain in Argentina overnight, but some longer-term forecasts were showing lesser rain amounts and hotter temperatures. The strong export sales were the fundamental news this market needed to sustain all day buying interest.
Soybeans
Soybeans had losses early in the week but had net gains on the week with a strong finish.
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The soybean markets opened lower Feb. 2 with March down 10.75 cents and strong selling pressure brought the market sharply lower with closing prices down 20 to 21 cents. The lower stock markets and lower crude oil put heavy pressure on the soybean market. Weekly export inspections were surprisingly strong at 33.5 million bushels, which was above expectations and well above the 14.1 million bushels needed to keep pace with USDA projections. This should have been viewed as a very strong number considering the fact the China was on holiday during that week, but the market largely ignored the export numbers.
The soybean markets opened lower Feb. 3 with March down 14.5 cents, and strong selling pressure had the market down 13 to 30 cents at the close. A recovery in stock markets and crude oil combined with a sharply lower dollar should have helped soybeans but seemed to have little effect. There were rains overnight in northern soybean-growing regions of Argentina that came to be the main focus of the negative trade.
The soybean markets opened higher Feb. 4 with March up 10.5 cents and had strong buying interest early, but the buy orders dried up and the market trended lower. Closing prices were mixed, down 5 cents to up 5 cents. The outside markets were supportive early with higher stock markets and a lower dollar, but a reversal in those markets during the day brought pressure into the grain markets. Near-term rain events were reduced in Argentina, but more rain was added to the forecast for later in the week. Soybeans were led by a strong soybean oil market early but pressured by the weak meal market later in the day.
The soybean markets opened higher Feb. 5 with March up 7 cents and had strong buying interest from commercial and noncommercial traders throughout the day, closing up 24 to 30 cents. The outside markets were mixed early but provided decent support by the end of the day, with most of that support coming from the higher stock markets. Export sales of 12.4 million bushels was the lowest number we had seen in awhile, but still was above what was needed to keep pace with projections. Shipments were well above the pace needed. There was rain in Argentina overnight, but some forecasts were showing lesser rain amounts and hotter temperatures.
Canola
The canola market trended higher during the week, which came as a surprise as the U.S. soybean complex came under selling pressure at the beginning of the week. After posting hefty losses the previous week, the canola market bounced back posting large gains for the week. Most contracts gained $9 (Canadian) to $13 (Canadian) by the end of the week with the March contract up $12.30 (Canadian) to $432.40. Canola market overcame outside market pressure throughout the week as rains fell in Argentina causing soybeans to trade lower early in the week. Weakness in the Canadian dollar, combined with new export business and increasing domestic demand helped canola separate itself from the U.S. soybean market much of the week. Cash bids in Velva, N.D., Feb. 5 were up 23 to $15.47.
Barley
There were no new barley sales for last week. Exports shipments for barley last week totaled 13,778 bushels compared with the 68,000 bushels shipped last year during this marketing week. This leaves the annual export shipments of barley at 10.6 million bushels compared with 27.3 million bushels for last year at this time.
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Durum
Durum had export sales for last week of 600,000 bushels, bringing the yearly total to 15.1 million bushels, compared with 35.4 million the previous year. Export shipments of durum last week totaled 1.06 million bushels, all of which went to Sri Lanka. Durum shipments for last week were 147,000 bushels more than the week before.
