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3 Big Things Today, October 6

Wheat Futures Rise on Demand; Ethanol Production Falls to Lowest Since June.

1. Wheat Rises After Morocco Buys 260,000 Tons From U.S. Supplies

Wheat futures rose overnight after reports surfaced that Morocco bought grain from the U.S., while soybeans declined, and corn was little changed.

The North African country purchased 260,000 metric tons of soft wheat from U.S. exporters, the country’s grain agency, known as the ONICL, said on Wednesday, according to Reuters. The shipments are for delivery before the end of the year.

Export sales have been strong for wheat, beans, and corn since the start of their respective marketing years. Wheat sales since June 1 are up 28% from the same time frame a year ago. Since September 1, the start of the year for corn and beans, corn sales have jumped 51%, and bean sales are up 78% year over year, according to the U.S. Department of Agriculture.

Still, favorable harvest weather in much of the Midwest is capping prices for corn and soybeans.

Wheat futures for December delivery rose 2½¢ to $4.07½ a bushel on the Chicago Board of Trade, while Kansas City futures added 1¾¢ to $4.16¾ a bushel.  

Corn futures for December delivery fell 1¢ to $3.46¾ a bushel.

Soybeans for November delivery declined 4¢ to $9.52¾ a bushel in Chicago. Soy meal futures for December delivery lost $1.50 to $303.90 a short ton, and soy oil declined 0.03¢ to 32.81¢ a pound.

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2. Ethanol Production Falls to Lowest Level Since June, EIA Says

Ethanol production in the week that ended on September 30 fell to the lowest level since June, according to the Energy Information Administration.

Output last week averaged 980,000 barrels a day, the EIA said. Production has been on the decline since reaching a record in August, according to the agency. Stockpiles of the biofuel totaled 20.2 million barrels at the end of last week, down from 20.6 million seven days earlier but up slightly from two weeks prior.

The EIA said in a prior annual report that ethanol capacity jumped to almost 15 billion gallons a year, or 973,000 barrels a day, on January 1. Capacity is up by more than 500 million gallons a year when compared with the start of 2015, the agency said.

Naturally, the bulk of the production facilities are where the corn’s grown – in the Midwest. The region accounts for 13.5 billion gallons a year in output. Iowa is the biggest ethanol producer, putting out about 4 billion gallons a year. Nebraska is a distant second at about 2 billion gallons, according to the EIA.

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3. Storms For Iowa, Oklahoma; Hurricane Matthew Set to Make Landfall in Florida

Thunderstorms are expected in parts of Iowa and Oklahoma today, with much of the Midwest being dry, according to the National Weather Service.

Storms are expected to persist into tomorrow in much of eastern Iowa, though severe weather is not expected to be an issue, according to the National Weather Service. Flooding continues to be a problem along the Mississippi River, which is still above flood stage at some points.

In Oklahoma, heavy rain-producing thunderstorms are forecast in the northeastern part of the state, which could produce small hail and heavy precipitation, the NWS said.

Almost all of Florida and the Atlantic Ocean side of Georgia and South Carolina are under hurricane warnings as Matthew prepares to make landfall.

“The National Hurricane Center is tracking major Hurricane Matthew in the Caribbean,” the NWS said. “Matthew is moving northward through the northern Caribbean, and it is expected to impact Florida beginning Thursday.”

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