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3 Big Things Today, November 2

Grains, Beans Little Changed Overnight; Monsanto Shareholders Vote on Bayer Deal December 13.

1. Grains, Soybeans Little Changed in Overnight Trading

Grains and soybeans were little changed in overnight trading as investors sit on the sidelines waiting for the Federal Reserve meeting that starts today and the presidential election next week, and finding out if yields are as good as the government has forecast.

The Federal Open Markets Committee (FOMC) will meet again today to determine whether to raise its federal funds rate for the first time since December. It’s unlikely any action will be taken (the CME Group’s FedWatch Tool puts odds at 7.2% that the FOMC will hike rates) at the November meeting, but there’s a 73.6% chance interest will rise in December.

The uncertainty over the November 8 presidential election also is keeping a lot of investors on the sidelines. Add into that concern over the size of the harvest and many speculators and hedgers are taking some time away from the markets.

Corn futures for December delivery were unchanged at $3.49 a bushel on the Chicago Board of Trade.

Soybeans for January delivery fell 1½¢ to $9.91¾ a bushel in Chicago. Soy meal futures for December delivery added 10¢ to $309.60 a short ton, and soy oil lost 0.05¢ to 34.80¢ a pound.  

Wheat futures for December delivery rose ¼¢ to $4.14¾ a bushel in Chicago, while Kansas City futures declined ¼¢ to $4.13½ a bushel. 

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2. Monsanto Shareholders to Vote on Bayer Merger December 13; Investors Skeptical of Deal

Monsanto Co. will hold a special meeting of shareholders on December 13 to vote on whether the company should merge with Bayer AG, the company said in a statement on Tuesday.

The company didn’t offer much in the way of details, only saying that the meeting will be held at the company’s global research and development headquarters in Chesterfield, Missouri. Additional details, Monsanto said, will be included in the company’s proxy statement.

Bayer said on September 15 it would buy Monsanto for $66 billion after months of wrangling between the two companies. If approved, Monsanto shareholders will receive $128 a share. Bayer had originally offered $127 a share, then $127.50 a share, before the companies agreed on the final price.

Even if its shareholders approve the transaction, it’s not a done deal. The acquisition likely will face regulatory scrutiny globally. Senators in some farm states, including Charles Grassley from Iowa, have already called for hearings, and Senator Bernie Sanders called the deal “at threat” to American farmers because it reduces competition and raises prices for farmers.

The uncertainty is reflected in the stock price. Shares of Monsanto were trading at about $101 a share before the market opened on Wednesday despite Bayer’s promise to pay $128 a share at the close of the deal, reflecting investor skepticism that the transaction will actually be approved by stakeholders and regulators.

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3. Rain Expected in Parts of Midwest, Southern Plains

Thunderstorms are possible in several parts of the Midwest and Southern Plains today, according to the National Weather Service.

In eastern Iowa and northern Illinois, storms will accompany a slow-moving cool front, though no severe weather is expected, the NWS said in a report on Wednesday morning. Rainfall amounts will be light but may be enough to further muddy fields.

In Oklahoma and the Texas Panhandle, heavy rain is expected throughout the day and evening. The storms rolling through the area may produce “locally heavy rain and flash flooding,” the NWS said.

“A few inches of rainfall may occur from slow-moving storms late this afternoon and tonight across parts of Oklahoma and western north Texas,” the agency said. The thunderstorms will be capable of producing winds of up to 70 mph, half-dollar-size hail, and lighting.

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