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3 Big Things Today, May 22
1. Soybeans Higher, Grains Lower in Overnight Trading
Soybeans were higher in overnight trading on weather concerns, while corn and wheat were lower after reaching multimonth highs.
Continued wet weather that’s kept producers from getting their fields planted has underpinned the soybean market.
Only 19% of the U.S. soybean crop was seeded as of Sunday, well behind the prior five-year average of 47%, the USDA said in a report.
Iowa farmers had planted 27% of their beans, while Illinois was only 9% finished with seeding. That compares to the averages of 55% and 51% for this time of year, respectively.
Corn planting also is well behind normal, with 49% in the ground vs. the normal 80%, the USDA said. Spring wheat also is behind the average pace for this time of year.
Corn futures, however, reached the highest in almost a year, and wheat prices hit a three-month high, leading some investors who’d made bullish bets on the crops to sell contracts and book profits.
Winter wheat in the U.S. was 64% good or excellent as of Sunday, up from 36% at the same time last year, the government said. That is keeping a lid on wheat futures.
Soybeans for May delivery rose 2¾¢ to $8.24¾ a bushel overnight on the Chicago Board of Trade. Soy meal added 20¢ to $295.50 a short ton, and soy oil lost 0.05¢ to 27.09¢ a pound.
Corn futures for May delivery fell 4¼¢ to $3.90 a bushel overnight.
Chicago wheat for May delivery declined 6¼¢ to $4.72½ a bushel overnight, while Kansas City wheat lost 6¢ to $4.30 a bushel.
2. Global Economy Will Suffer if Trade War Escalates, OECD Says
The Organization for Economic Cooperation and Development said in a report that continued escalation of the trade war between the U.S. and China will knock about 0.7% from global gross domestic product in the next two years.
Growth in the U.S. and Chinese economies, the world’s largest, have shown signs of slowing in recent months, which, in turn, has weakened the global economy, the OECD said.
Global economic expansion will slow to 3.2% this year from 3.5% last year but may accelerate to 3.4% next year, the OECD said. That’s well below growth rates over the past three decades, the organization said in its report.
The U.S. bumped tariff rates to 25% from 10% on more than $200 billion worth of Chinese goods earlier this month after the Trump administration accused the Asian country of backing out of agreements it had made.
China retaliated with additional levies on $60 billion worth of U.S. goods including some agricultural products. It’s likely Beijing has halted purchases of U.S. soybeans, as evidenced by the Weekly Export Sales Report.
Once the biggest buyer of U.S. soybeans, China has been conspicuously absent from the sales report in the past couple of weeks.
3. More Storms Headed For Parts of Oklahoma, Kansas, Missouri Thursday
More rain is on the way for parts of Oklahoma, Kansas, and Missouri where more than 3 inches of rain fell Monday and Tuesday, according to the National Weather Service.
Another round of severe thunderstorms that will bring heavy rain and possibly large hail will hit the area today and Thursday, the NWS said in a report.
Flash flood warnings, flood warnings, and flash flood watches are in effect for a large chunk of southeastern Kansas, northeastern Oklahoma, and southern Missouri.
“Another round of strong to severe thunderstorms is expected mainly for areas along and north of Interstate 44 this evening and into tonight,” the agency said in a report this morning. “This dynamic system will be capable of producing hail up to the size of tennis balls, damaging winds up to 70 mph, and tornadoes. A strong tornado or two may be possible.”
Rainfall also is expected in parts of eastern Iowa, northern Illinois, and southern Wisconsin, which likely will further delay planting. Thunderstorms are expected to develop after 4 p.m. today and continue into tonight, the NWS said.