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130446

3 Big Things Today, September 6

Corn, Beans Lower Overnight on Output; Money Managers Most Bearish Corn Since April

1. Corn, Soybean Futures Decline Amid Rising Production Forecasts

Corn and soybean futures were lower overnight as investors begin to eye what’s expected to be record production in the U.S.  

The Department of Agriculture has pegged the national corn yield at 175.1 bushels an acre and the total output at 15.2 billion bushels. Soybean yield is pegged by the government at 48.9 bushels and total production at 4.06 billion bushels.

INTL FCStone on Friday raised its outlook for U.S. corn yield to 175.6 bushels an acre, up from a prior outlook for 175 bushels and pegged output at 15.2 billion bushels. The researcher also increased its soybean yield forecast to 50.1 bushels an acre from 48.8 bushels and projects growers will produce 4.16 billion bushels.

Corn futures for December delivery fell 2¾¢ to $3.25¾ a bushel overnight on the Chicago Board of Trade.  

Soybeans for November delivery declined 2¾¢ to $9.49¾ a bushel, soy meal futures for December delivery lost $1.80 to $305.60 a short ton and soy oil rose 0.28¢ to 33.32¢ a pound.

Wheat futures for December delivery declined 3½¢ to $3.95¾ a bushel overnight in Chicago, while Kansas City futures fell 3½¢ to $4.09¾ a bushel.

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2. Investors Expecting Record Harvests Most Bearish Corn Since April

Money managers were the most bearish they’ve been on corn in almost four months and cut bets on higher soybean prices, the Commodity Futures Trading Commission said in a report on Friday.

Speculative investors were net short 174,489 corn futures contracts, up from 158,486 a week earlier, the largest such position since April, according to the CFTC. Investors lowered their bullish bets on soybeans to 93,264 futures contracts from 113,446 the prior week.

Declining expectations about corn and bean prices aren’t that surprising considering the bulk of the harvest is quickly approaching. About 65% of corn in Texas is mature. In the biggest growing states of Iowa and Illinois, plants are 4% and 7% mature, respectively.   

Still, traders and investors alike are looking ahead to harvest, which is expected to be records for both corn and beans.

Net shorts in soft red winter wheat rose to 123,338 contracts, while investors were net short by 17,155 hard red winter wheat contracts, up from 15,548 a week earlier, the CFTC said in the report.

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3. Flood Watches Issued From South Dakota to Wisconsin as Heavy Rain Forecast

A large storm system stretching from southern South Dakota east into Minnesota and much of Wisconsin could bring rains and strong winds to the area, according to the National Weather Service.

The rain could be heavy at times, causing flooding, the NWS said.

“A slow-moving low-pressure system will bring several rounds of showers and thunderstorms to the area through Wednesday night,” the NWS said in a report on Tuesday morning. “This system will take advantage of deep tropical moisture and is expected to produce heavy rainfall over most of the region. The heavy rainfall may result in flooding of rivers, streams, and urban areas.”

A flash flood watch is also in effect for several counties in northwestern Kansas and southwestern Nebraska, according to the agency.

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