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3 Big Things Today, November 7, 2019
1. Soybeans Higher on Reports China, U.S. to Drop Tariffs
Soybeans were higher in overnight trading after Chinese state media said Beijing and Washington agreed to remove some of the existing tariffs on each other’s goods.
China Commerce Ministry spokesman Gao Feng said China and the U.S. were closer to a so-called phase one agreement after talks, state media reported.
Leaders from both countries – the world’s two largest economies – had been seeking a place to sign a trade deal after the Asia-Pacific Economic Conference scheduled for this month in Chile was canceled due to ongoing protests.
Reuters reported yesterday, citing a U.S. administration official, that President Donald Trump and President Xi Jinping may delay signing any agreement until December as talks continue about a suitable location.
Several locales have been suggested including London, Switzerland, and Iowa.
Soybean futures for November delivery rose 3½¢ to $9.31 a bushel overnight on the Chicago Board of Trade. Soy meal gained $1.70 to $300.60 a short ton, while soybean oil fell 0.07¢ to 31.68¢ a pound.
Corn futures for December delivery rose ¾¢ to $3.79½ a bushel.
Wheat for September delivery gained 2¾¢ to $5.19½ a bushel, while Kansas City futures were unchanged at $4.27¾ a bushel.
2. Ethanol Production Rises to Highest Level Since Early September, Inventories Higher
Ethanol production rose for a sixth straight week to the highest level in almost two months last week, according to the Energy Information Administration.
Stockpiles also increased.
Output of the biofuel was up to an average of 1.014 million barrels a day in the week that ended on November 1, the EIA said in a report. That’s up from 1.004 million barrels a day, on average, seven days earlier and the highest since the week that ended on September 6.
Gains came in the Midwest, by far the biggest-producing region, where output jumped to an average of 936,000 barrels a day from 924,000 barrels, the agency said.
East Coast production was up to 27,000 barrels a day from 26,000 barrels a day, on average.
West Coast output, however, declined to an average of 16,000 barrels a day from 18,000 barrels, and Gulf Coast production was down to 21,000 barrels a day from 22,000 barrels, the EIA said.
Rocky Mountain production was unchanged at an average of 14,000 barrels a day.
Stockpiles, meanwhile, increased for the first time in three weeks, rising to 21.874 million barrels, the agency said. That’s up from 21.099 barrels seven days earlier.
In other news, the USDA is scheduled to release its Weekly Export Sales Report this morning.
Corn sales are pegged by analysts from 300,000 to 650,000 metric tons, soybean sales are forecast from 600,000 to 1.2 million tons, and wheat sales are expected to be from 350,000 to 600,000 tons, according to researcher Allendale.
3. Freezing Fog, Drizzle Will Continue in Kansas; Winter Weather Advisory Issued in Oklahoma
Freezing fog or drizzle is falling in much of northwestern Kansas this morning with temperatures in the 20s, according to the National Weather Service.
The freezing weather has been in the area for about the past 12 hours, making roadways slick and travel dangerous, the NWS said in a report early this morning.
Farther south, in west-central Oklahoma, a wintry mix of snow and freezing rain is possible this morning, the agency said.
A winter weather advisory is in effect in the area.
“A small area of freezing rain and drizzle will persist through the morning hours across northwestern and western Oklahoma behind a cold front,” the NWS said. “A glaze of ice will be possible on elevated surfaces. The freezing rain may transition to sleet and slow later this morning across northwestern Oklahoma.”
Dry, cold weather is expected across much of the central Corn Belt today and tomorrow, the weather service said.