Barge basis for corn, soy rises on export demand, freight costs
Basis bids for corn and soybeans shipped by barge to U.S. Gulf Coast terminals strengthened on Tuesday, reflecting spot demand from exporters and rising freight costs in some areas.
Traders continue to monitor falling river levels on the Ohio and Mississippi rivers. Low water could impede barge movement in the coming weeks, raising freight rates just as the harvest ramps up.
Empty barges were offered on the lower Ohio River on Tuesday at 600% of tariff, up from 575% on Friday. Offers also firmed on the Memphis-to-Cairo segment of the Mississippi River.
Weekly export inspections data reflected a strong pace of U.S. corn and wheat shipments. The U.S. Department of Agriculture said 1.4 million metric tons of corn were inspected for export in the week ended August 28, near the high-end of trade estimates for 850,000 to 1.5 million tons.
For wheat, weekly export inspections totaled 802,780 tons, topping expectations for 250,000 to 700,000 tons.
Soybean export inspections totaled 472,914 tons, in line with expectations for 200,000 to 500,000 tons. The data showed no soybean shipments bound for China.
At the Gulf on Tuesday, CIF soybean barges loaded in September were bid at 53 cents over Chicago Board of Trade November (SX25) futures, up 3 cents from Friday.
FOB export premiums for soybeans shipped from the Gulf in October were around 82 cents over November futures, up 2 cents from Friday.
For corn, CIF Gulf September corn barges were bid at 68 cents over CBOT December (CZ25) corn futures, up 3 cents from Friday.
But FOB export premiums for corn shipped from the Gulf in October were around 100 cents over December futures, down 4 cents from Friday, reflecting rising competition from South American supplies, traders said.
Weekly U.S. crop condition ratings declined. The USDA on Tuesday rated 69% of the corn crop as "good or excellent", down from 71% a week earlier but in line with analyst estimates. The soybean crop rating slipped to 65% good-to-excellent from 69% a week earlier, below analyst expectations.
A federal appeals court on Friday ruled most of U.S. President Donald Trump's sweeping tariffs illegal, setting up a potential showdown at the Supreme Court. The ruling pressured Wall Street markets on Tuesday.
