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3 Big Things Today, August 11

Corn, Beans Lower on Weather; Ethanol Production at Second Highest Ever.

1. Corn, Beans Lower Overnight on Favorable Crop Weather

Corn and soybeans declined overnight, as more rain is forecast for much of the Midwest in the next week to 10 days, further improving the outlook for crops.

Precipitation in eastern areas of the Midwest that have been dry will improve prospects for corn and beans, according to MDA Information Services. The forecaster said extremely heavy rains in southern parts of the U.S. may inundate fields with water, however.

Cooler weather also may help crops as heat indexes that have topped 100˚F. have dominated forecasts for the better part of the past three weeks.

Corn futures for December delivery fell 1¼¢ to $3.31¾ a bushel overnight on the Chicago Board of Trade.

Soybean futures for November delivery declined 1¾¢ to $9.80½ a bushel. Soy meal futures for December delivery rose a dime to $330.20 a short ton, and soy oil lost 0.33¢ to 31.66¢ a pound.

Wheat futures for September delivery fell 1¼¢ to $4.20½ a bushel in Chicago, while Kansas City wheat was unchanged at $4.11¾ a bushel.

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2. Ethanol Production Quietly Rises to Second Highest Ever, Stockpiles Fall

With everybody is looking at crop production ahead of tomorrow’s World Agricultural Supply and Demand Estimates (WASDE) report, it may have gone unnoticed that ethanol production last week was the second highest on record.

Ethanol makers produced an average of 1.018 million barrels, or 42.8 million gallons, a day in the week that ended on August 5, behind only the week that ended on July 15, according to the Energy Information Administration. Stockpiles, meanwhile, declined about 1% to 20.46 million barrels (each barrel totaling 42 gallons), the government said.

This is good news for farmers, of course, as increased production means more corn usage, while declining stockpiles may lead to further demand from ethanol producers.

With the corn crop looking rosy through much of the Midwest – the Department of Agriculture will release its monthly Supply and Demand Report tomorrow – it’s good to know there’s demand, at least for now, for the large crop that’s almost ready for harvest.

But how long will the demand for ethanol last? The kids are back in school soon and driving will slow, but hopefully there won’t be too big a decline in ethanol usage.

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3. Iowa to Get Extreme Heat and Thunderstorms, Possible Flooding on Thursday

Iowa is getting a strange mix of weather this morning, as heat warnings, flash flood watches, and a hazardous weather outlook have all been issued in one part of the state or another.

As much as 3 inches of rain may fall in parts of Iowa and southern Minnesota this afternoon and evening, which could cause flash flooding, the National Weather Service said in a report on Thursday morning.

Heat indexes are in effect for the southwestern part of the state, which will stretch south to the Texas Gulf Coast and east well into Illinois, NWS maps show. Heat indexes are expected to top 105˚F. today and even higher further south.

As always, strenuous activity in the areas where temperatures are high is not advised, and those who are outside should stay hydrated and take frequent breaks to avoid overheating.

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