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3 Big Things Today, December 19

Wheat Higher in Overnight Trading on Extreme Cold; Money Managers Bearish Second Straight Week.

1. Wheat Futures Rise in Overnight Trading on Winterkill Worries

Wheat futures rose in overnight trading after extremely cold weather in the eastern Midwest and the Southern Plains hurt plants that lacked snow cover.

“Winterkill was noted in west-central Illinois, southern Iowa, and northern Missouri over the weekend,” said Donald Keeney, a senior agricultural meteorologist at MDA Information Services. “Very cold conditions yesterday resulted in some widespread winterkill damage in southern Nebraska, much of Kansas, eastern Colorado, northwest Oklahoma, and northwest Texas as snow cover there remains thin.”

Temperatures are expected to moderate as the week goes on, he said.

Wheat futures for March delivery rose 1¼¢ to $4.10½ a bushel on the Chicago Board of Trade. Kansas City futures added 3¼¢ to $4.18 a bushel.

Corn and soybeans were lower overnight as investors focus on supply rather than demand. U.S. growers likely harvested record crops this fall, boosting supplies of both commodities. While demand has been strong due to low prices and easily available supplies, it may not be enough to underpin prices, analysts have said.

Corn futures for March delivery fell 1½¢ to $3.54¾ a bushel in Chicago.

Soybean futures for January delivery declined 5¢ to $10.31¾ a bushel overnight. Soy meal dropped $1.50 to $315.60 a short ton, and soy oil fell 0.07¢ to 36.67¢ a pound.

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2. Speculators Lower Bets on Higher Soybeans, Lower Corn Second Straight Week

Speculative investors lowered their net-long positions, or bets on higher prices, in soybeans and were more bearish on corn for a second straight week, the Commodity Futures Trading Commission said in a report.

Investors were net-long 121,859 soybean futures contracts, down from 124,758 the prior week, the second consecutive decline, the CFTC said in a report on Friday. Speculators raised their net-short positions, or bets on lower prices, in corn futures by 5.5% to 69,050 contracts, according to the agency.

Bearish factors – including ample supplies after record corn and bean harvests along with improved weather in parts of South America, which could add to the glut – have investors concerned that prices will decline as the new year approaches.

U.S. growers likely produced 15.2 billion bushels of corn on yields of 175.3 bushels an acre and 4.36 billion bushels of soybeans on yields of 52.5 bushels an acre, all record highs, according to the Department of Agriculture.

The bearishness, however, comes amid strong demand for U.S. supplies. Exporters in the week that ended on December 8 sold more than 1.5 million metric tons of corn and 2 million tons of soybeans to overseas buyers.

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3. Extremely Low Temperatures Have Wheat Farmers on Winterkill Watch

Extremely low temperatures in parts of the Southern Plains have winter wheat growers watching their plants for winterkill.

Temperatures in Guymon, Oklahoma, in the state’s panhandle hovered at about 3˚F., while Amarillo, Texas, was at 6˚F., according to the National Weather Service.

Winterkill occurs when plants that lack a protective layer of snow are expose to temperatures that stay below freezing for more than a few hours. The so-called polar vortex has left the weather much colder than normal, though temperatures are expected to moderate as the week progresses, the NWS said.

Wind chills this weekend from -20˚F. to -30˚F. in much of the Upper Midwest.

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