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3 Big Things Today, August 1

Grains, Beans Little Changed Overnight; Ethanol Output Drops, Stocks Rise to Record.

1. Grains, Soybeans Little Changed in Overnight Trading

Grains and soybeans were little changed in overnight trading as investors weigh mixed weather throughout the Midwest and trade uncertainty between the U.S. and China.

Thunderstorms are bringing rain to parts of the Midwest including Nebraska and western Iowa, though too much rain has fallen in eastern Kansas and western Missouri, which led to flooding overnight.

That compares with a heat wave in the Southern Plains, as temperatures in Oklahoma soar into the triple digits.

On the trade front, meanwhile, talks between the U.S. and China this week fizzled out after the sides traded barbs. On the day the negotiations were set to continue, President Donald Trump said China isn’t buying U.S. agricultural products as promised, essentially saying the Chinese aren’t to be trusted.

China responded by saying the U.S. is reneging on promises it has made in the past.

The talks amounted to a working dinner and a half day of negotiations that ended with no deal in sight. Still, Xinhua news agency said the talks were “frank, highly efficient, and constructive.” More talks are scheduled in coming weeks.

Soybean futures for November delivery lost ¼¢ to $8.81¼ a bushel overnight on the Chicago Board of Trade. Soy meal declined 40¢ to $305 a short ton, while soybean oil rose 0.16¢ to 28.39¢ a pound.

Corn futures for December delivery gained 1¾¢ to $4.11¾ a bushel overnight.

Wheat for September delivery rose ¼¢ to $4.87½ a bushel, while Kansas City futures added 2¢ to $4.24¾ a bushel.

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2. Ethanol Production Drops to Three-Month Low While Inventories Surge to Record

Ethanol production fell to the lowest level in three months, while stockpiles surged to a record high last week, according to the Energy Information Administration.

Output in the seven days that ended on July 26 averaged 1.031 million barrels a day, the EIA said in a report.

That’s down from 1.039 million barrels the previous week and the lowest since the week that ended on April 26.

In the Midwest, by far the biggest-producing region, production decreased to an average of 952,000 barrels a day from 961,000 barrels the prior week, the agency said in its report.

That was the entirety of the week to week loss, as Gulf Coast output rose to 24,000 barrels a day, on average, from 23,000 barrels.

East Coast production was unchanged at 25,000 barrels a day, on average, West Coast was unchanged at 16,000 barrels, and Rocky Mountain output was unchanged at an average of 13,000 barrels a day, the EIA said.

Stockpiles, meanwhile, surged to 24.468 million barrels in the week that ended on July 26. That’s up from 23.689 million barrels seven days earlier and the highest on record, according to the EIA.

In other news, the USDA is expected to release its weekly Export Sales Report this morning. Analysts are looking for corn sales of 300,000 to 850,000 metric tons, soybean sales from 100,000 to 700,000 tons, and wheat sales from 300,000 to 600,000 tons, according to researcher Allendale.

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3. Flash Flood Warning Issued Along Kansas-Missouri Border as 10 Inches of Rain Falls

A flash flood warning, flood warnings and flash flood watches are in effect for several counties in eastern Kansas and western Missouri this morning, according to the National Weather Service.

As much as 10 inches of rain fell in the area overnight, indicating flash flooding is occurring, the NWS said in a report early this morning. Another 1 to 2 inches of precipitation are expected in the warned area.

“Showers and thunderstorms have developed this morning across portions of eastern Kansas into western Missouri,” the agency said. “Additional rounds of precipitation are expected over the next several days through early Saturday morning.”

Just south in Oklahoma, a heat advisory is in effect in the center of the state.

Heat index values of up to 107˚F. is expected as temperatures hover around 103˚F. and dewpoints reach the upper 60s, the NWS said.

Outdoor activity isn’t advised if it can be avoided.

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