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3 Big Things Today, May 20

Beans, Grains Higher in Overnight Trading; Money Managers Raise Bearish Bets.

1. Soybeans, Grains Rise Overnight on More Wet Weather

Soybeans and grains were higher in overnight trading as more wet weather moves into the Midwest and Plains, which will keep producers from planting in several states.

Wet weather is expected today in several states.

In eastern Iowa and northern Illinois, showers are in the forecast for tonight, which could become heavy at times, according to the National Weather Service.

Along with further delays in planting, the rains also could worsen flooding in the region, the agency said. More precipitation is expected Tuesday and Tuesday night.

Rain is also forecast for much of Kansas, Oklahoma, and parts of western Missouri.

Only 30% of U.S. corn was seeded as of last week, compared with the prior five-year average of 66%, the USDA said. Nine percent of soybeans were in the ground, well behind the average of 29% for this time of year.

Soybeans for May delivery jumped 10½¢ to $8.32 a bushel overnight on the Chicago Board of Trade. Soy meal added $3.90 to $298.20 a short ton, and soy oil gained 0.11¢ to 27.33¢ a pound.

Corn futures for May delivery rose 6½¢ to $3.89¾ a bushel overnight.

Chicago wheat for May delivery gained 9¾¢ to $4.74¾ a bushel overnight, while Kansas City wheat added 14½¢ to $4.34¾ a bushel.

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2. Speculative Investors Increase Bearish Bets on Corn, Soybeans in Week Through May 14

Money managers extended their bearish bets on corn and soybeans in the seven days that ended on May 14, according to the Commodity Futures Trading Commission.

Investors held net-short positions, or bets on lower prices, of 298,551 corn futures contracts as of last week, the CFTC said in a report. That’s up from 295,998 futures contracts the previous week.

Speculators were net short 171,141 soybean futures contracts, up from 163,028 contracts a week earlier, the agency said.

Despite continued wet weather in the Midwest and Plains, investors held their large bearish positions in corn and beans. Instead, they’re focused on the ongoing trade war between the U.S. and China and the effects it will have on demand.

In wheat, money managers lowered their bearish bets, though only slightly.

Investors held 81,837 net-short positions in soft red winter wheat futures contracts last week, down from 86,931 contracts seven days earlier, the CFTC said.

For hard red winter wheat, investors were net short by 57,198 futures contracts on May 14, down from 59,759 contracts the previous week.

The Weekly Commitment of Traders Report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.

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3. Severe Weather Expected in Kansas, Missouri, Oklahoma; Freeze in South Dakota

Severe weather is forecast for much of Kansas, western Missouri, and almost all of Oklahoma today, which will worsen flooding in some areas and may further delay planting.

 A flood warning is in effect along some rivers in central Kansas, and a flash flood watch has been issued for the rest of the area, according to the National Weather Service.

“Widespread heavy rain is expected from this afternoon through Tuesday morning, before ending by early Tuesday afternoon,” the NWS said in a report early this morning. 

As much as 5 inches of rain are possible in the region.

“Rainfall of this magnitude will result in significant rises and flooding on many creeks and streams,” the agency said. “Locally intense rainfall may also lead to flash flooding of rural and urban areas.”

A freeze warning is in effect in parts of northeastern South Dakota as temperatures drop to around 30˚F. A frost warning is in effect for all of North Dakota, parts of northern South Dakota, and most of Minnesota, according to NWS data.

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