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3 Big Things Today, November 21, 2019

Soybeans, Corn Little Changed Overnight; Ethanol Production Rises to Highest Since August.

1. Soybeans, Grains Little Changed in Overnight Trading

Soybean and grain futures were little changed in overnight trading amid uncertainty about the ongoing trade war between the U.S. and China.

The much-anticipated Phase 1 trade deal between the countries – the world’s two largest economies – may be delayed until next year, Reuters reported yesterday.

The U.S. is set to impose tariffs on billions of dollars more in Chinese goods on December 15, and President Donald Trump said this week he would increase levies on imports from the Asian nation if a deal isn’t struck soon.

Morgan Stanley strategist Andrew Sheets told CNBC today that the so-called Phase 1 deal “might be about as good as it gets” and that any further deals “remain distant next year.” Beijing won’t accept a deal without tariff reductions and is reportedly reluctant to agree to a set amount of agricultural imports.

Chinese Ministry of Commerce spokesman Gao Feng told reporters that his country is willing to work toward such an agreement and that the sides are communicating.

Soybean futures for January delivery fell ¾¢ to $9.04¼ a bushel overnight on the Chicago Board of Trade. Soy meal rose 50¢ a short ton while, soybean oil decline 0.24¢ to 31.17¢ a pound.

Corn futures for December delivery rose 1¢ to $3.67¾ a bushel.

Wheat for September delivery rose ½¢ to $5.19¼ a bushel, while Kansas City futures gained ¾¢ to $4.33¾ a bushel.

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2. Ethanol Output Rises to Highest in Three Months, Stockpiles at Lowest Since January 2017

Ethanol production rose for the eight straight week to the highest level in almost three months, while inventories dropped to the lowest in more than two years, according to the Energy Information Administration.

Output of the biofuel averaged 1.033 million barrels a day in the week through November 15, the EIA said in a report. That’s up from 1.03 million, on average, the previous week and the highest level since August 23.

Production in the Midwest, by far the largest-producing region, was unchanged at an average of 957,000 barrels a day, the agency said.

Gulf Coast output led gainers, rising to 20,000 barrels a day from 15,000 the prior week. East Coast production increased to an average of 27,000 barrels a day from 26,000 barrels in the previous seven-day period, the EIA said.

Rocky Mountain production declined by 1,000 barrels to an average of 14,000 barrels a day, while West Coast output also fell by 1,000 barrels to 16,000 barrels.

Stockpiles, meanwhile, fell to 20.514 million barrels in the week through November 15, the EIA said.

That’s down from 20.985 million the previous week and the smallest amount in storage since January 2017, government data show.

In other news, the USDA is expected to release its Weekly Export Sales Report this morning. Analysts forecast corn sales from 400,000 to 900,000 metric tons, soybean sales from 800,000 to 1.4 million tons, and wheat sales from 200,000 to 500,000 tons, according to researcher Allendale.

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3. Oklahoma, Texas Panhandles Facing Winter Weather; Indiana May See Showers

Parts of the Oklahoma and Texas panhandles are facing a winter weather advisory, as a storm is expected to bring snowfall to the region, according to the National Weather Service.

As much as 3 inches of snow are expected to fall with locally higher amounts possible, the NWS said in a report early this morning. Slick roads are possible.

The advisory is set to begin at 3 p.m. local time.

Farther north in central Indiana, showers and windy conditions are expected to start late this morning, the NWS said.

Wind gusts of up to 40 mph are possible through the evening. Stronger gusts also are likely, the agency said.

Thunderstorms are forecast in parts of northern Illinois and southeastern Iowa throughout much of the morning. Strong winds also are possible with gusts as high as 45 mph, the NWS said.

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