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3 Big Things Today, June 12

Wheat Futures Fall Overnight; Speculators Raise Bets Against Beans to Multiyear Highs.

1. Wheat Falls After USDA Raises Production, Yield; Corn, Beans Lower

Wheat futures declined overnight after the U.S. Department of Agriculture last week unexpectedly raised its forecast for winter output.

The agency increased its 2017 production estimate for winter wheat to 1.25 billion bushels from 1.246 billion a month earlier. It also said yield would come in at 48.9 bushels an acre, up from 48.8 bushels.

While the increases are minimal, they were somewhat unexpected as growers, traders, and analysts had been worried about a snowstorm that dropped as much as 2 feet of snow in much of western Kansas and the Oklahoma and Texas panhandles in the last weekend of April.

At the time, crop-watchers predicted that there was indeed damage that would curb yield and production, but favorable weather after the snowstorm apparently gave crops a boost.

Wheat futures for July delivery dropped 6¢ to $4.39¾ a bushel overnight on the Chicago Board of Trade. Kansas City futures declined 5¾¢ to $4.40 a bushel.

Corn futures for July delivery fell 4¢ to $3.83¾ a bushel overnight.

Soybeans lost 3¼¢ to $9.38¼ a bushel in Chicago. Soy meal fell $1.90 to $304 a short ton, and soy oil rose 0.03¢ to 32.32¢ a pound.

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2. Speculators Push Bets on Lower Soybean Prices to Multiyear Highs, Lower Bets Against Corn

Money managers pushed bets on lower soybean prices to the highest in at least five years while lowering their bearish bets in corn.

Speculative investors in the week that tended on June 6 pushed net-short positions in soybeans to 101,752 contracts, down from 93,790 the prior week, the lowest in at least five years, according to data from the Commodity Futures Trading Commission.

Investors in corn were net short by 127,078 contracts, the least bearish they’ve been since the week that ended on March 21, the CFTC said.

Money managers lowered their bets against soft red winter wheat prices, being net short by 112,413 contracts last week, down from 121,605 seven days earlier.

Hard red winter wheat was the only major grain on which investors are bullish. Speculators were net long, or bet on higher prices, by 871 contracts last week, though that’s down from 1,981 contracts a week earlier.

Still, investors have been bullish on hard red winter wheat for six straight weeks, according to the CFTC.

The Weekly Commitment of Traders Report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.

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3. Isolated Thunderstorms Forecast For Nebraska, Iowa This Afternoon, Some Severe

Isolated thunderstorms are forecast in much of Nebraska and Iowa this afternoon with some storms north of Interstate 80 possibly becoming severe.

The storms are expected to continue into tomorrow as an upper-air disturbance moves through the region. The worst of it may include large hail, damaging winds, and “perhaps a few tornadoes,” the National Weather Service said in a report early Monday.

Temperatures in much of the region will still be extremely warm, ranging from 95˚F. to 100˚F. today.

Farther east, there’s limited possibility that thunderstorms will develop in Illinois and Indiana today and tomorrow. There is a better chance for storms starting possibly on Wednesday, the NWS said.

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