Market Matters Blog

Weekly national average soybean basis of 83 cents over the August futures is 8 cents higher than last week and is higher than the DTN 5-year average strongest basis. Processors and exporters continue to push to fill nearby crush and export commitments as old-crop supplies remain tight with farmer selling almost at a standstill. USDA's progress report on Monday showed soybean planting at 92% complete vs. the 5-year average of 95%. Planting progress was slower in Iowa, Wisconsin and Minnesota where rainfall and severe storms have been constant. Farmers in some of those states reported many acres need to be replanted due to recent hail damage and torrential rains damaging emerged crops. The basis along the river for export has been strong all week as exporters look for supplies to cover previous commitments, along with possible fresh demand until Brazil port issues stabilize. However, with recent heavy rainfall in the Midwest, traffic along the upper Mississippi River will once again be at a standstill due to rising river levels.

Wednesday, the U.S. Army Corp of Engineers announced they are expecting to close 6 locks on the upper Mississippi due to rising water. The locks and location listed here are courtesy of the USACE: Lock 16, Illinois City, Ill., 6/28; Lock 17, New Boston, Ill., 6/28; Lock 18, Gladstone, Ill., 6/29; Lock 20, Canton, Mo., 6/30; Lock 21, Quincy, Ill., 7/2; Lock 22, Saverton, Mo., 7/1. USACE stated it is unclear how long the locks will remained closed or if further closures will become necessary.

The lock closures could once affect movement of soybeans, corn and wheat to the Gulf. USDA said in the weekly Grain Transportation Report that grain loading at the Gulf may increase in the next few weeks depending on how long the locks remained closed. As of the week ended June 20, there were 45 vessels at the Gulf expected to be loaded within the next 10 days, which is 5% higher than a year ago, but 29% higher than the average of expected loadings in the past 11 weeks. Grain movement along the Mississippi River during the week ended June 22 totaled 491,199 tons, which was 26% higher than last week, but 15% lower than the 5-year average. However, the total grain movement for last week was the highest movement since early March. During that same week, 310 barges moved down river, which was 28% higher than last week, but empty barges heading upriver transiting Mississippi River Locks 27, Arkansas River Lock and Dam 1, and Ohio River Locks and Dam 52 totaled 441 barges, down 33 barges from the prior week, according to USDA.

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