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3 Big Things Today, October 26

Soybean Rise on Another China Purchase; Syngenta-ChemChina Deal Faces Scrutiny.

1. Soybeans Rise After China Makes Another Large Purchase

Soybean futures rose overnight after the Department of Agriculture announced exporters sold a large shipment to China.

Exporters reported a sale of 516,000 metric tons of U.S. soybeans to China yesterday for delivery in the marketing year that started on September 1. Sales have been extremely strong so far this year, as overseas buyers take advantage of low prices to stock up on supplies.

Last week, unknown buyers purchased 192,000 tons of soybeans, and China bought a cargo of 706,500 tons from U.S. inventories. Sales since the start of the marketing year are up almost 30% compared with the same time frame a year earlier, according to the USDA.

Soybeans for November delivery rose 7¼¢ to $9.98 a bushel on the Chicago Board of Trade. Soy meal futures for December delivery added $2.30 to $310.50 a short ton, and soy oil gained 0.19¢ to 35.99¢ a pound.

Corn futures for December delivery rose ½¢ to $3.49¾ a bushel in Chicago.

Wheat futures for December delivery gained 2¢ to $4.06¼ a bushel in Chicago, while Kansas City futures added 1½¢ to $4.15 a bushel. 

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2. Syngenta, ChemChina Still ‘Fully Committed’ to Acquisition

Syngenta said it is still committed to a merger with Chinese state-owned ChemChina on Tuesday, though it knows the regulatory process is taking longer than previously expected.

The companies originally wanted to close the deal, valued at $43 billion, by the end of 2016, but that doesn’t look like it’s going to happen, as the European Commission, the governing body of the European Union, said ChemChina didn’t offer concessions relating to its acquisition of Syngenta, according to news reports on Tuesday. The commission may launch an investigation into the deal, which could take some time.

“In a context of industry consolidation, regulators in the EU and elsewhere have recently requested a large amount of additional information, and we now expect the regulatory process to extend into the first quarter of 2017,” said Erik Fyrwald, the chief executive of Syngenta. “ChemChina and Syngenta remain fully committed to the transaction and are confident of its closure.”

The transaction comes among a wave of consolidation on the agriculture industy. Bayer is in the process of acquiring Monsanto in a transaction worth $66 billion. Dow and DuPont are planning to merge and then split into three separate publicly traded companies. Deere is attempting to buy Monsanto’s Precision Planting, but is facing regulatory hurdles.

Syngenta reported Tuesday sales in the third quarter of $2.5 billion, down 3% from the prior year. Sales also fell 3% in the first nine months of the year to $9.6 billion.

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3. Midwest Mostly Dry With Some Isolated Showers Sprinkled In

The Midwest will be mostly dry this afternoon with only a few scattered showers possible.

Rain is forecast in parts of northwest Missouri this morning, but any storms will push off by noon, the National Weather Service said in a report on Wednesday. No severe weather is expected in the area.

Moderate to heavy rainstorms are expected in counties in northern Iowa, southern Minnesota, and southern Wisconsin this afternoon, the NWS said. Some minor flooding may accompany the storms if they continue.

As much as 3 inches of rain already fell in parts of northern Iowa overnight, according to the agency. Another inch is expected at some point today.

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