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3 Big Things Today, December 5

Soybean Futures Rise in Overnight Trading; Money Managers Boost Bets on Higher Bean Prices.

1. Soybeans Higher Overnight on Speculation Recent Losses Will Boost Demand

Soybean futures were higher overnight after four straight days of losses is likely to boost demand.

The contract’s last gain was Monday, and falling prices may give overseas buyers enough incentive to jump in and fill needs, analysts said.

Export sales of U.S. soybeans since the start of the marketing year on September 1 are up 27% from the same time frame a year earlier, according to the Department of Agriculture. Sales of corn are up 76% year over year, and wheat sales since the start of the crop year have gained 31%, all as buyers take advantage of lower prices to fill needs.

Still, bumper corn and bean crops in the U.S. likely will keep a lid on prices.

Soybeans for January delivery gained 9¢ to $3.48¼ a bushel overnight on the Chicago Board of Trade. Soy meal futures for December delivery added $3.40 to $315.90 a short ton, and soy oil rose 0.18¢ to 37.90¢ a pound. 

Corn futures added a penny to $3.48¼ a bushel in Chicago.

Wheat futures for December delivery rose 2¾¢ to $4.07 a bushel in Chicago, while Kansas City futures gained ¾¢ to $4.09½ a bushel. 

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2. Speculative Investors Boost Bets on Higher Soybean Prices

Money managers increased their bets that soybean prices will rise to the highest level in almost five months amid strong demand for U.S. supplies.

Investors were net-long 137,371 soybean futures contracts, up 19% from the prior week, and the largest such position since July 8, the Commodity Futures Trading Commission said in a report on Friday.

Demand for U.S. inventories has been strong as several countries including China, the world’s biggest buyer of soybeans, have been filling needs amid low priced.

Despite strong demand for corn, investors aren’t taking the same bullish stance on corn. Net-short positions, or bets on a price decline, rose week over week 43% to 65,111 corn futures contracts as of last Tuesday even as corn sales so far this marketing year are well ahead of last year’s pace.

Money managers are positive on hard red winter wheat contracts as they raised their bets on higher prices to 17,114 contracts from 10,886 the prior week, according to the CFTC.

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3. Bitterly Cold Weather Expected in Southern Plains This Week

Cold weather is expected in parts of the Southern Plains this week, which could threaten hard red winter wheat crops that have little or no snow cover.

“Arctic air will surge over the region Tuesday night and Wednesday, giving the region the coldest air of the season,” the National Weather Service said in a report on Monday morning. “Wind chills in the single digits and teens are expected Wednesday night through Friday morning.”

Some snow is possible in the region with northern Oklahoma having the best chance to see precipitation, though little or no accumulation is expected, the NWS said.

Weather maps are mostly quiet in the Midwest with some parts of Nebraska, Iowa, and Illinois expected to see some light precipitation and low temperatures.

An arctic air blast will linger over western and central Nebraska for most of the week with temperatures between Wednesday and Friday falling to -5 to -15, the agency said. Wind chills will bottom out this week at -20˚F., according to the weather service.   

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