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3 Big Things Today, June 27
1. Wheat Futures Higher Overnight on Fewer Canadian Acres
Wheat futures were higher in overnight trading after Canada said it expects growers to reduce acres and as the winter wheat harvest remains well behind schedule in the U.S.
Statistics Canada said all wheat acres are expected to drop about 1% to 24.6 million acres, while durum planting will plunge almost 21% year over year.
In the U.S., the winter wheat is still behind its normal pace. As of Sunday, only 15% of the crop was collected vs. the prior five-year average of 34%, according to the USDA.
In Kansas, the biggest producer of winter varieties, only 5% was in the bin vs. the normal 36% for this time of year, the USDA said.
The good news for producers is the weather looks mostly dry for the next few days in the Southern Plains, though isolated thunderstorms are expected to roll through the region, the National Weather Service said in a report early this morning.
Wheat for September delivery rose 5¾¢ to $5.52¼ a bushel overnight on the Chicago Board of Trade, while Kansas City wheat gained 6¢ to $4.88 a bushel.
Soybeans for May delivery fell ¼¢ to $8.94 a bushel. Soy meal gained 60¢ to $314 a short ton, while soy oil added 0.11¢ to 27.92¢ a pound.
Corn futures for May delivery were down 1¢ to $4.48½ a bushel overnight.
2. Ethanol Production Hits Three-Week Low, Stockpiles Drop to Lowest in 13 Months
Ethanol production fell to the lowest level in three weeks, and inventories declined to a 13-month low last week, according to the Energy Information Administration.
Output in the seven days that ended on June 21 averaged 1.072 million barrels a day, the EIA said in a report. That’s down from 1.081 million barrels a day previously and the lowest since the week that ended on May 31.
Output in the Midwest, by far the biggest producer, declined to an average of 994,00 barrels a day from 1.003 million in the prior week, the government said. Rocky Mountain output fell to 11,000 barrels a day, on average, from 13,000 previously.
East Coast production was unchanged at 27,000 barrels a day, on average. Gulf Coast output increased to an average of 24,000 barrels a day from 22,000 barrels, and West Coast production rose to 17,000 barrels from 16,000, the EIA said.
Stockpiles, meanwhile, continued to drop for another week.
Inventories plunged to 21.567 million barrels in the week through June 21, the agency said. That’s the lowest level since the seven days that ended on May 25, 2018.
In other news, the USDA will release its Weekly Export Sales Report this morning. Analysts are looking for corn sales from 250,000 to 750,000 metric tons, soybean sales from 300,000 to 800,000 tons, and wheat sales from 200,000 to 500,000 tons, researcher Allendale said in a note early this morning.
3. Severe Thunderstorm Watch in Effect For Parts of Eastern Dakotas, Most of Minnesota
A severe thunderstorm watch is in effect in eastern South Dakota, southeastern North Dakota, and a very large chunk of Minnesota this morning.
Thunderstorms are expected to roll through the region today, mostly through the early afternoon, according to the National Weather Service.
Some large hail and damaging winds may result from the storm, while the front also may produce heavy rain that could lead to or worsen flooding in the area, the NWS said in a weather report early this morning.
Starting tomorrow, however, heat will arrive in the area with temperatures in the high 90s, especially over the weekend. Heat indexes could top 100˚F. on Saturday and Sunday in much of Minnesota, the agency said.
In southeast Missouri, meanwhile, a flash flood warning is in effect for a few counties, as thunderstorms producing “torrential rainfall” led to rivers and tributaries overrunning their banks.
Up to 2 inches of rain had fallen as of about 4 a.m., and another 2 inches are expected, the NWS said.