Gulf corn barge basis eases as exporters shift focus to soybeans

what happened

Reuters reports that bids for corn sent by barge to the US Gulf Coast slipped on Friday, even though farmers were selling less grain. Exporters at the Gulf were kept busy loading soybeans, traders said. China is still buying American beans: the Department of Agriculture confirmed a private transaction covering 136,000 metric tons of soy bound for China, plus 101,000 tons of corn sold to buyers not identified.

Beijing has pledged to buy at least 25 million metric tons of US soybeans for the 2026-27 season, which began September 1. By October 22 it had acquired 15.1 million tons and shipped 5.9 million, according to a Foreign Agricultural Service report released this week.

The Midwest harvest is nearing its finish, though rain earlier this week held up the final field work, and drier conditions are forecast for next week. Growers in western Illinois and eastern Missouri need roughly three more weeks, a merchandiser said. Farm sales of grain have stalled as December corn and January soybean futures on the Chicago Board of Trade fell to multi-month lows. One broker said farmers had lost interest in selling.

CIF corn barges loaded in November were bid at 86 cents over December CBOT futures, 3 cents below Thursday. FOB premiums for corn vessels loaded in December held near 110 cents. For soybeans, CIF barges for November were bid at 105 cents over January futures, 1 cent lower, while FOB premiums for December Gulf soybeans stayed around 118 cents.

why it matters

The key signal for traders is the gap between export demand and farmer selling: a weak basis and sluggish sales point to soft physical demand in the region. Ahead of the November 10 USDA report, analysts on average expect a lower US corn yield estimate and a higher soybean yield estimate, which could set the market's direction.

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