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3 Big Things Today, September 1

Grains, Beans Higher Overnight; Justice Department Suing to Block Deere's Purchase of Precision Planting.

1. Grains, Soybeans Rise Overnight on Signs of Overseas Demand

Corn, beans, and wheat were all higher overnight on signs of demand for supplies of all three from the U.S.

The Department of Agriculture yesterday reported sales to overseas buyers of corn, beans, and even wheat. Exporters sold 187,000 metric tons of soybeans for delivery to China in the 2016-2017 marketing year that starts today.

Mexico reportedly bought 275,000 metric tons of corn for delivery in the 2016-2017 year, which also starts today. Exporters sold 138,000 metric tons of hard red winter wheat to unknown destinations for delivery in the marketing year that runs June 1 through May 31, the USDA said.

Corn futures for December delivery rose 3¢ to $3.18½ a bushel overnight on the Chicago Board of Trade.  

Soybeans for November delivery added 4½¢ to $9.47½ a bushel, soy meal futures for December delivery gained $2.50 to $309.20 a short ton, and soy oil lost 0.09¢ to 32.78¢ a pound.

Wheat futures for December delivery rose 5½¢ to $3.93¾ a bushel overnight in Chicago, while Kansas City futures gained 6¼¢ to $4.03¾ a bushel.

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2. Justice Department Seeks to Stop Deere’s Purchase of Precision Planting

The U.S. Department of Justice is suing to keep Deere & Co. from buying Monsanto’s Precision Planting LLC, as the transaction would remove competition and raise prices, the government said in a statement.

The acquisition would bring at least 86% of all precision planting technology under the John Deere banner, as the company would own both its ExactEmerge high-speed planting technology and Precision Planting, the top-selling systems in the U.S., the Justice Department said. The two are the only effective competitors in the high-speed precision planting market, the department said.

Deere is the largest manufacturer of planting equipment in the U.S. with sales of planters totaling about $900 million last year. Monsanto’s Precision Planting segment had sales of about $100 million last year.

The companies introduced their respective high-speed planting systems in 2014, and the “intense head-to-head competition” has benefitted farmers, as Deere and Precision Planting offered discounts, promotions, and product offerings, along with lower prices, to draw customers.

“The (Justice Department) alleges that Deere’s proposed acquisition of the company it has described as its ‘number one competitor’ would allow it to control nearly every method through which American farmers can acquire effective high-speed precision planting systems and provide it with the ability to set prices, output, quality, and product features without the constraints of market competition,” the DOJ statement said. “The acquisition would deny farmers throughout the country the benefits of competition that has spurred innovation, improved quality, and lowered prices.”

The department filed its lawsuit in the U.S. District Court for the Northern District of Illinois.

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3. Flooding Likely in Oklahoma, Texas Panhandles; Parts of Iowa, Illinois Under Water

Thunderstorms rolling through the panhandles of Oklahoma and Texas will bring rainfall that could cause flooding, the National Weather Service said in a report on Thursday morning.

Several counties in both states are in a flood watch until 6 p.m. local time.

“Thunderstorms are expected across the panhandles today and tonight,” the NWS said. “While severe weather is not anticipated, storms will be capable of producing heavy rainfall, which may lead to flooding or localized flash flooding.”

Flooding also is occurring in parts of Iowa and Illinois, weather maps show. Several rivers and creeks are flowing over their banks near the Quad Cities and south near Burlington, Iowa, and Peoria, Illinois, according to the NWS.

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