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3 Big Things Today, October 18, 2019
1. Soybeans Higher, Grains Lower in Overnight Trading
Soybeans were higher while grains were lower in overnight trading.
President Donald Trump has said that a trade deal with China is going to be written over the next three weeks and that it will be “very substantial.” He said last week the Asian nation would buy between $40 billion and $50 billion worth of U.S. agricultural products.
China, however, has said it wants Washington to remove tariffs if the two countries – the world’s largest economies – are expected to come to an agreement.
The U.S. halted a proposed increase in tariffs on some products that was scheduled to go into effect on Oct. 15, but officials said if a deal isn’t in place by December, new tariffs will go into effect as planned.
Corn and wheat both declined overnight as the harvest rolls on in the Midwest.
Dry, albeit cold weather in some parts of the Corn Belt have farmers harvesting grain as quickly as possible. About 22% of corn had been collected by the start of the week, well behind the average of 36% for this time of year, according to the U.S. Department of Agriculture.
Only 26% of U.S. soybeans had been harvested as of Sunday, which is down from the prior five-year average of 49%.
Soybean futures for November delivery rose 2¼¢ to $9.33¾ a bushel overnight on the Chicago Board of Trade. Soymeal gained 80¢ to $307.60 a short ton while soybean oil fell 0.01¢ to 30.38¢ a pound.
Corn futures for December delivery fell 3¼¢ to $3.91½ a bushel.
Wheat for September delivery declined 4½¢ to $5.21 a bushel, while Kansas City futures lost 3½¢ to $4.27¾ a bushel.
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2. Ethanol Production Moves Higher, Still Below 1 Million-Barrel Mark
Ethanol production eked higher but stayed below the 1 million-barrel mark for the fourth straight week. Stockpiles also rose.
Output of the biofuel in the seven days that ended on Oct. 11 rose to an average of 971,000 barrels per day from 963,000 the previous week, according to the Energy Information Administration.
That’s the highest level since the week that ended on Sept. 13, which also was the last time production broke the 1 million-barrel mark.
In the Midwest, by far the largest producing area, output was reported at an average of 905,000 barrels a day, up from 890,000 barrels a week earlier, the EIA said in a report.
That was the entirety of the increase as West Coast production was unchanged at 16,000 barrels a day, on average, and Rocky Mountain output was unchanged at 14,000 barrels a day.
East Coast production fell by 4,000 barrels to an average of 19,000 a day, and Gulf Coast output declined by 3,000 barrels to 17,000 a day, the agency said in its report.
Stockpiles, meanwhile, rose week-to-week to 22.061 million barrels from 21.224 million the previous week.
3. Freeze Warnings Issued For Parts of Southern Michigan, Frost Advisory in Indiana, Ohio
A freeze warning is in effect for parts of southern Michigan with a frost advisory issued for Indiana and the western half of Ohio this morning, according to the National Weather Service.
Temperatures in Michigan were expected to fall as low as 28°F. overnight, the NWS said in a report earlier this morning. Widespread frost is forecast along with the freezing weather.
“Late-season crops not harvested prior to Friday morning may be damaged or killed,” the agency said in its report.
Temperatures in Indiana and Ohio were expected to be as low as 30°F.
Frost is forecast to be widespread with possibly a light freeze in localized areas this morning, the NWS said.