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3 Big Things Today, July 27

Soybean Higher on Strong Demand; M&A Activity Rolls on in Agriculture.

1. Soybean Futures Rise on Signs of Strong Export Demand

Soybean futures rose overnight on signs of strong demand even as favorable weather moves back into the U.S. Midwest.

Shipments of the oilseeds inspected for export in the seven days that ended on July 21 topped 26 million bushels, the most in almost four months and well above the 15 million the prior week, the Department of Agriculture said. While export sales last week weren’t exactly stellar, China was a big buyer, which is always a good sign that the U.S. is competitively priced against Argentina and Brazil.

Prices also may be rebounding from three-month lows hit earlier this week as bargain hunters seek to buy contracts.

Corn futures were little changed overnight, as more rain rolls into the Midwest this week.

Soybean futures for November delivery rose 6¾¢ to $9.80½ a bushel overnight on the Chicago Board of Trade. Soy meal futures for December delivery gained $1.80 to $340.10 a short ton, and soy oil added 0.01¢ to 30.09¢ a pound.

Corn futures for December delivery rose ¼¢ to $3.39¾ a bushel in Chicago.

Wheat futures for September delivery added ¼¢ to $4.15¼ a bushel in Chicago, while Kansas City wheat declined ½¢ to $4.11½ a bushel.

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2. M&A Activity in Agriculture Rolls On as Largest Moves Making Waves

The agriculture industry has been a hotbed of mergers and acquisitions recently, and some of the bigger deals have taken major steps in the past few days and weeks. Here’s a roundup of where things stand between some of the larger companies.

Dow-DuPont

The European Commission will decide whether to allow Dow and DuPont to merge soon as a provisional deadline on the ruling has been set for August 11. The companies are offering a number of concessions to the European Union in a bid to win approval from antitrust regulators, according to news reports. DuPont Chief Executive Ed Breen said in a conference call to discuss earnings this week that the merger is still on track even as regulators in the EU, U.S., China, and Brazil ensure the deal doesn’t break rules on competition. The combined company would create a $122 billion conglomerate that would eventually split into three separate entities.

Monsanto-Bayer AG

Monsanto turned down yet another offer from Bayer AG last week but said it’s still open to talking about a potential buyout from the German chemicals firm. Monsanto said no to Bayer’s all-cash offer of about $64 billion, even after Bayer included a $1.5 billion reverse antitrust breakup fee. Monsanto’s board of directors unanimously rejected the offer, saying it was “financially inadequate.”

Syngenta-ChemChina

The proposed merger between Syngenta AG and China National Chemical Corp., better known as ChemChina, is being protested by some U.S. farm groups. The National Farmers Union (NFU) and Food and Water Watch sent a letter recently saying regulators should halt the deal due to economic and security concerns. “With growing pressures caused by increased populations and climate variability, the U.S. must protect its food and agricultural resources by blocking any further control of food and agribusinesses by Chinese entities,” NFU President Roger Johnson said in a statement. 

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3. Rain Expected to Last This Week in Nebraska, Iowa

Thunderstorms will roll through parts of Nebraska, Iowa, and Illinois today with the potential to bring damaging winds, according to the National Weather Service.

A hazardous weather outlook has been issued for several counties in Nebraska and Iowa. The NWS said in a report on Wednesday that “there is a marginal risk for severe thunderstorms this afternoon and evening” in central Nebraska.

Rain will continue in much of the Midwest throughout the rest of the week, according to the NWS.

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