CENTRAL CITY, Neb. (Dow Jones)--Cash corn and soybean prices stood at new

record highs across the U.S. Monday, with domestic basis remaining firm,

despite skyrocketing futures markets. Wheat basis exhibited extreme volatility.


  "The battle to buy acres between corn and soybeans appears to be in high

gear, sending prices for those crops to new all-time highs," said Bryce Knorr

of Farm Futures. "There's mounting indications that producers may plant 85

million acres or less (to corn), which could trigger further reductions in

ending stocks, even with good growing season weather."


  Interior basis for corn has held completely steady over the past week, with

spot soybean basis rising about 2 cents a bushel, even as futures march to

unprecedented levels.


  "Increasingly, soybeans are seen as an inflation hedge, thanks to a U.S.

dollar that is weaker again this morning, making new all-time lows on fears

that a slowing economy will force the Federal Reserve into more interest rate

cuts," added Knorr. "Gold is also moving higher as it targets $1,000 an ounce."


  Globex trading saw cash contracts climb by 7 cents for corn, about 16 cents

for oats, 33 cents for soybeans and around 30-40 cents for wheat.


  "U.S. (wheat) futures markets continue to be chaotic, exhibiting astounding

volatility," said U.S. Wheat Associates.


  That volatility has also extended to the cash basis market, pushing daily

domestic premiums down by almost 14 cents a bushel for spring wheat, while

lifting national average SRW basis up by almost 12 cents entering Monday's

trading session.


  "Traders (are) citing tight supplies of exportable quality (SRW), said U.S.

Associates, but the group also added that flour, "mills report full nearby

coverage," of HRS.


  National cash price indices maintained at the MGE currently stand at $14.26

1/4 for soybeans, indicating an average basis level of -95 3/4 cents, relative

to March CBOT futures contracts. Domestic cash prices also average $5.19 1/2

for corn (-26 1/2 cents basis March CBOT corn), $11.40 3/4 for hard red winter

wheat (-19 1/4 cents basis KCBT May wheat), $9.97 3/4 for soft red winter wheat

(-88 1/4 cents basis CBOT May wheat), and $17.57 3/4 for hard red spring wheat

(+$1.38 basis MGE May wheat).



  CROP WEATHER



  A mixture of rain, ice and snow was limiting cash grain trade from the

central Great Lakes to the northern Delta and southern Plains Monday.


  The storm system drew tremendous amounts of warm air into the central U.S.

over the weekend, producing highs above 60 degrees Fahrenheit as far north as

central Iowa.


  "With that type of temperature regime, we saw the deep snow cover across the

upper Midwest melt very quickly and thus there are a lot of problems with

flooding in Iowa and northern Illinois this morning," said Freese-Notis

Weather. "Flooding is also a problem in southwestern Missouri, northwestern

Arkansas, and eastern Oklahoma here early on this Monday, but that is flooding

due strictly to tremendous amounts of rain that fell overnight."


  Radar echoes estimate that anywhere from 1.50 to as much as 4.00 inches of

rain has fallen in the affected area.


  "If anything, the worst of the storm is still yet to come," said the service.

"Precipitation totals over the next 48 hours will be on the order of 1.00 to

3.00 inches for especially northern Arkansas, far southeastern Missouri, the

southern third of Illinois, the southern half of Indiana, all but far northern

Ohio and western Kentucky. One can safely assume that flooding will be a

problem in those areas, given that river levels are already high, from what was

a very wet month of February."