3 Big Things Today, April 11
1. Soybeans Higher Overnight as USDA Lowers Domestic, Global Inventories
Soybean futures were higher in overnight trading after the USDA lowered its domestic and global stockpiles forecast.
The USDA in its monthly World Agricultural Supply and Demand Estimates (WASDE) Report pegged domestic soybean inventories at the end of the marketing year on August 31 at 550 million bushels, down from a March forecast for 555 million bushels and analyst estimates for 574 million bushels.
Global carryout was cut to 90.8 million metric tons from 94.4 million, according to the USDA. Production in Argentina was projected at 40 million tons, down from 47 million, lowering the country’s inventories outlook to 49.95 million tons from 53.18 million a month earlier.
Soybean futures for May delivery rose 7¢ to $10.57 a bushel overnight on the Chicago Board of Trade. Soy meal gained $2 to $385.90 a short ton, and soy oil declined 0.1¢ to 31.75¢ a pound.
Corn futures rose ¼¢ to $3.89½ a bushel overnight.
Wheat lost 3¾¢ to $4.88¼ a bushel in Chicago, while Kansas City futures fell 4¼¢ to $5.36¼ a bushel overnight.
2. Argentina Buys Most Soybeans From U.S. in 21 Years; USDA Raises Brazil Export Outlook
Argentina bought the biggest shipment of U.S. soybeans in 21 years, according to the USDA, as drought wreaks havoc on the South American country’s crop.
The purchase comes at an interesting time. China has threatened to put a 25% tariff on soybeans from the U.S. with most industry analysts saying if that happens, the Asian country – the world’s biggest importer of the oilseeds – will turn to South America for supplies.
Argentina’s crop, however, was cut to 40 million metric tons from 47 million amid ongoing drought. To be sure, Argentina isn’t exactly a hotbed of soybean exports, as it’s projected to ship only 4.2 million metric tons this year, but that’s down from a prior outlook for 6.8 million tons.
Brazil is, by far, the biggest exporter of soybeans, and the USDA pegged exports at 73.1 million metric tons, up from 70.5 million a month earlier. U.S. exports were projected at 56.2 million tons, unchanged from the March report.
Still, the USDA said yesterday that Argentina bought 120,000 metric tons of soybeans from U.S. supplies, the most since 1997, according to Reuters, for delivery in the marketing year that starts on September 1.
China is back in the market, purchasing 132,000 tons, while an unknown buyer took 279,000 tons, the agency said.
3. Winter Weather Headed to Northern Plains as Extreme Dryness Plagues Southern U.S.
The weather maps are lit up like a Christmas tree this morning amid winter storms in the Northern Plains and extremely dry weather in a wide swath of land from Nebraska to Texas and west into southern California.
A winter storm watch is in effect for much of the Northwestern Plains. In the western Dakotas, rain is expected to change to snow late Thursday night into Friday, according to the National Weather Service. The snow may be heavy at times.
Along with the snow will come winds sustained at 20 to 35 mph with gusts of up to 50 mph, mainly in South Dakota the NWS said.
A very large area of land is under a red-flag warning this morning. The affected area stretches from extreme northern Nebraska all the way south into West Texas and west all the way to southern California. All of New Mexico and Arizona are included in the warning. It also doglegs east through southern Kansas into southwestern Missouri, according to NWS maps.
In the Southern Plains, where hard red winter wheat is trying to grow after being dormant over the winter, wind gusts of up to 55 mph are expected along with relative humidity as low as 6%, the agency said.