3 Big Things Today, June 29
1. Wheat Futures Jump as Dry Conditions Persist in Northern Plains
Wheat futures jumped as rainfall that’s moving through the Midwest missed the Northern Plains, increasing worries that dry weather will harm the spring crop. Corn and beans were higher overnight.
Only isolated and scattered thunderstorms are expected in much of the Northern Plains the rest of the week, further limiting chances for relief from dry weather the past few weeks. Spring wheat futures reached a three-year high, which boosted winter wheat prices.
About two thirds of North Dakota, the biggest U.S. spring wheat producer, is suffering from drought while the rest is abnormally dry, according to the Drought Monitor. A year ago, less than 1% of the state was facing drought conditions.
Wheat for September delivery rose 8¾¢ to $4.81¾ a bushel on the Chicago Board of Trade. Kansas City futures added 7¾¢ to $4.88 a bushel.
Corn futures rose 1¾¢ to $3.68 a bushel in Chicago.
Soybean futures for July delivery gained 5¾¢ to $9.19¾ a bushel overnight. Soy meal gained $1.40 to $296 a short ton, and soy oil rose 0.19¢ to 32.31¢ a pound.
2. Ethanol Production Jumps to Highest in a Month, Stockpiles at Lowest Since January
U.S. ethanol production jumped to the highest level in a month, while stockpiles dropped to the lowest since January.
Ethanol production in the week that ended on June 23 rose to an average of 1.015 million barrels a day, according to the Energy Information Administration. That’s the highest level since the seven days that ended on May 26.
Inventories, meanwhile, plunged to 21.838 million barrels, the lowest level since the week that ended on January 20, the EIA said in a report.
There was concern that ethanol production was on the downswing while inventories were rising, which is a negative for corn.
Analysts note that they will keep an eye on production and inventory levels to see if this is a one-week anomaly or the beginning of a trend.
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3. Storms Continue to Move Through Much of Midwest, Eastern Areas to Receive Less Rain
More rainfall is expected today and tonight in much of the Midwest, which should give a needed boost to corn and soybeans that have recently emerged from the ground.
While that’s good news for growers in much of Nebraska, Iowa, and Illinois, they should be on the lookout for severe weather associated with the storms.
“Another round of strong to severe thunderstorms is forecast this afternoon and evening,” the National Weather Service said in a report early Thursday. “Large hail, damaging winds, and even a few isolated tornadoes are possible. Heavy rains will also be possible with the storms.”
Farther east, there’s a small chance of thunderstorms late this afternoon and tonight for much of Indiana, southern Michigan, and Ohio, the NWS said. There’s also a chance for storms on Friday, but severe weather is not expected.
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