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3 Big Things Today, May 3

Wheat Futures Fall on Tour Numbers; Dow-DuPont Merger Continues to Move Forward.

1. Wheat Futures Drop as Kansas Wheat Tour Finds Crop in Decent Shape

Wheat futures fell from a two-month high on reports from the Kansas Wheat Tour that yields in the northwestern part of the state may be better than expected.

The tour stopped in 222 fields on Tuesday as more than 70 participants fanned out through the northern and central part of the state. The average forecast for yield in the region was about 43 bushels an acre, better than many had expected considering the vast amounts of snow that fell in the state over the weekend.

Still, the estimate is down from 47.1 bushels an acre on the first day of the tour last year, which was unusually strong. Growers harvested 37 bushels an acre and 28 bushels in 2015 and 2014, respectively, according to the U.S. Department of Agriculture.

The tour has two days left and participants and traders across the globe are left wondering how much the crop was damaged by the snowfall over the weekend, which likely won’t be known for at least two weeks.

Wheat for July delivery fell 5½¢ to $4.48½ a bushel overnight on the Chicago Board of Trade, and Kansas City futures declined 8¾¢ to $4.59 a bushel.

Soybeans rose ½¢ to $9.69¼ a bushel in Chicago. Soy meal added 90¢ to $315.90 a short ton, and soy oil lost 0.18¢ to 32.44¢ a pound.

Corn futures for July delivery fell a penny to $3.71¼ a bushel.

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2. Dow-DuPont Merger Gets Conditional Approval From China to Move Ahead

The steam train that is the Dow-DuPont merger continues to fly down the tracks with seemingly nothing to slow it down.

China’s Ministry of Commerce has granted approval to the companies to merge. The approval, however, is contingent on the firms fulfilling certain commitments put forth by the ministry, the companies said in a joint statement on Tuesday.

“Specifically, and consistent with commitments already made to obtain the European Commission’s regulatory approval for the proposed merger of equals, Dow and DuPont will divest certain parts of DuPont’s crop protection portfolio and research and development pipeline and organization and Dow’s global Ethylene Acrylic Acid copolymers and ionomers business,” the companies said.

The European Union approved the merger on March 27.

Dow and DuPont also made commitments with regard to the supply and distribution in China of certain herbicide and insecticide ingredients and formulations for rice crops for five years after the closing of the proposed merger of equals, according to the statement.

China is considered a “critical” market for both companies and will continue to be for the spin-offs that result from the proposed merger.

After the approval in China, Dow and DuPont said their so-called merger of equals would indeed be completed sometime in August, as planned, and that the proposed split into three separate entities would be done about 18 months later.

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3. Flash Flood Warnings in Effect For Parts of South-Central Midwest as More Rain Falls

Flash floods warnings are in effect until at least later this morning in several counties in southwestern Missouri, southeastern Kansas, and extreme northeastern Oklahoma.

“Doppler radar indicated thunderstorms producing heavy rain across the warned area” this morning, the National Weather Service said in a statement. “One to 2½ inches of rain has already fallen. Flash flooding is expected to begin shortly.”

The Wilson Creek near Springfield, Missouri, for example, has risen more than 4 feet in the past two hours and is quickly approaching levels in which agricultural land and county roads will be flooded, the NWS said.

Flood warnings and watches are in effect for much of the central and eastern Midwest including the southern two-thirds of Missouri, the southern half of Illinois, pretty much all of Indiana, and counties in southern Michigan and northwestern Ohio, according to the agency.

Meanwhile, a frost warning has been issued for parts of the southern Plains where hard-red winter wheat is having a rough few days. The good news, however, is that temperatures are only expected to drop to 32°F. overnight, not low enough to do much damage.

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