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3 Big Things Today, July 5
1. Wheat, Soybeans Expected to Open Higher After July 4th Holiday
Wheat and soybean futures are expected to open higher after the Fourth of July holiday on signs of demand for grain amid global supply concerns.
Egypt, the biggest importer of the grain, said today it wants to buy cargoes of 55,000 to 60,000 metric tons of soft or milling wheat for shipment next month.
The country’s General Authority for Supply Commodities said in a statement on the group’s website that it’s seeking cargoes of soft white wheat from the U.S. and Canada or soft red winter wheat or hard red winter wheat from the U.S.
The Northern Plains continue to suffer from hot, dry weather with no relief in sight. Forecasters give the region little chance of rain and continue to see temperatures above normal for much of the next two weeks.
Soybeans, meanwhile, also surged on weather worries in areas of the world where competing oilseeds are grown.
In Malaysia, where palm is produced and turned into palm oil, production is expected to decline. In Canada, where canola is grown, dry weather in the Prairies has growers concerned about output.
Chicago wheat gained 29¢ on Monday to close at $5.55 a bushel, while Kansas City futures added more than 20¢.
Soybeans for August delivery jumped 23¢ to $9.70 a bushel; September corn rose 7½¢ to $3.88½ a bushel.
Trading resumes at 8:30 a.m. in Chicago.
2. Spring Wheat Hits Two-Year High, No Relief in Sight for Northern Plains
Spring wheat futures rose to the highest level in two years on Monday and, judging by weather forecasts, could move higher as no rain seems likely to fall in the Northern Plains anytime soon.
Commodity Weather Group said in a report that temperatures will be above to much-above normal for at least the next 15 days. Precipitation, meanwhile, will be below normal during the same time frame, the forecaster said.
About 40% of the crop was in good or excellent condition as of a week ago, according to the U.S. Department of Agriculture, which will release another Crop Progress Report today. That’s down from 41% a week earlier and a whopping 72% a year earlier. About 36% of the grain is headed.
About two thirds of North Dakota, the biggest producer of spring wheat in the U.S., is now facing drought conditions, while the rest is abnormally dry, according to the USDA. Only 39% of spring wheat in the state is in good or excellent condition.
Egypt jumped into the fray today by saying it tendered for U.S. wheat, which could boost prices further. Results from its tender are expected this afternoon, according to its main state buyer.
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3. Isolated Thunderstorms Expected Today in Midwest, Storms in Mississippi River Valley
Isolated thunderstorms are expected in the Midwest again today after a mostly dry Fourth of July holiday in the U.S.
Some severe storms are likely in parts of the Mississippi Valley, however, which could lead to heavy rains and flash flooding, the National Weather Service said in an early Wednesday report.
Some of the storms also may bring strong wind gusts, mostly in the northern Ohio Valley and mid-Atlantic, the NWS said.
In the Midwest, some storms are possible late Thursday into Friday, which could bring rain to the region, though precipitation will be spotty, according to the agency.
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