US Midwest spot soyabean basis bids were steady to firm early Wednesday, while corn basis bids were steady to narrowly mixed, grain merchandisers said. Light sales of both commodities were reported despite the drop to fresh contract lows this week in Chicago Board of Trade futures prices, they noted. The movement follows an unusually quiet January while US soya farmers withheld sales of last autumn's harvest due to prices that are half last spring's high ($10.64 per bushel for spot CBOT soya futures).
"Some of the soyabean movement today has been new sales and not just deliveries on old contracts," one Illinois dealer said early Wednesday.
"I don't think it has much relationship with the market," he added. Instead, it has to do with farmers needing cash or transportation logistics."
Many farmers will need to pay land rents, loans and other machinery bills by March 1, he noted. Federal income taxes are also due in the next months.
Some county roads have already posted signs forbidding trucks weighing more than 5 tons, the Illinois dealer said. Forecasts for warmer temperatures this weekend and next week mean roads could get muddier.
Other grain dealers said they thought some of this week's farmer sales may be due to speculation that soyabean prices could weaken further as the South American harvest picks up.
Weakening prices of both corn and soyabeans have triggered a federal price support program called Loan Deficiency Payments (LDPs). This payment, taken in lieu of enrolling in the federal loan program, pays producers the difference between posted county prices and that country's loan rate.
LDPs for soyabeans on Wednesday were 6 cents in Ohio, and 3 cents in Indiana and Illinois. There were no LDPs for soyabeans in Iowa or Nebraska.
LDPs for corn on Wednesday ranged from 20 cents to 22 cents across the US Midwest, dealers said. LDPs can be checked on the Internet at http://cardsrv7.card.iastate.edu/LDPAllCounties.aspx.
Chicago Board of Trade corn futures were called to open on Wednesday down 1/2 cent to 1 cent per bushel on large US corn supplies, brokers said. In overnight export business, Taiwan set a tender on Thursday to buy 40,000 to 60,000 tonnes of US corn, but Malaysia bought 60,000 tonnes of corn from Argentina.
CBOT soyabeans were called to open on Wednesday down 1 cent to 2 cents per bushel on follow-through selling after Tuesday's contract lows, brokers said. Overnight US soyabean export business was quiet.
CBOT wheat futures were called to open on Wednesday mixed, up 1/2 cent to down 1/2 cent, brokers said. Overnight US wheat export was also quiet.
Illinois River soyabean bids were steady, while corn bids weakened on Wednesday, dealers aid. Meanwhile, Mississippi River soya bids weakened, while corn bids were steady.
Spot Gulf CIF soyabean basis bids were steady to firm early Wednesday, export sources said. CIF corn basis bids were lower.
US Midwest cash wheat basis bids were mostly steady early Wednesday, grain dealers said.