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3 Big Things Today, April 28, 2022

Grain Futures Rise in Overnight Trading; Weekly Ethanol Output Rebounds.

1. Grain Futures Rise in Overnight Trading

Grain futures jumped in overnight trading on dry weather in South American and U.S. growing areas and as Russian attacks on Ukraine persist.

Soybeans were little changed.

Rain in parts of Brazil in the next 15 days likely will prevent further expansion of dry areas, but stress will continue for 35% to 40% of the country’s second, or safrinha, corn crop, Commodity Weather Group said in a report.

In Argentina, meanwhile, recent rains were less than forecast, pushing stress to build for about half the country’s growing areas, the forecaster said.

In the U.S., meanwhile, some rain is expected in the central Plains next week, but “drought relief (is) not favored in the southwestern half (of the) hard-red wheat belt,” CWG said.

Little or no rain has fallen in much of the southern Plains in the past 30 days, according to maps from the National Weather Service’s precipitation page.

Extremely dry weather is expected in the region at least through the weekend.

In Ukraine, eastern regions of the country are under fire as Russian troops intensify their attacks, according to several media reports.

Antonio Guterres, the secretary-general of the United Nations, is expected to visit Ukraine President Volodymyr Zelensky today even as Russian troops continue their attacks.

Corn futures rose 6¾¢ to $8.19 a bushel overnight on the Chicago Board of Trade.

Wheat for May delivery jumped 13¢ to $11.04¼ a bushel while Kansas City futures added 7½¢ to $11.61½ a bushel.

Soybean futures for May delivery fell ½¢ to $16.92¼ a bushel. Soymeal lost 50¢ to $440.50 a short ton, while soybean oil futures dropped 0.7¢ to 84.07¢ a pound.

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2. Ethanol Output Rises From Seven-Month Low, Inventories Fall

Ethanol output last week rebounded from an almost seven-month low while inventories continued to decline, according to the Energy Information Administration.

Production of the biofuel averaged 963,000 barrels a day in the week that ended on April 22, the EIA said in a report.

That’s up from 947,000 barrels a week earlier, which was the lowest output level since September.

In the Midwest, by far the biggest producing region, output climbed to an average of 902,000 barrels a day, up from 889,000 barrels, on average, the previous week, the agency said.

Gulf Coast production rose to an average of 25,000 barrels per day from 23,000 barrels a week earlier, and West Coast output climbed to 9,000 barrels a day from 8,000 barrels, the EIA said.

East Coast output was unchanged at 12,000 barrels a day for the fifth straight week.

Rocky Mountain production was steady at 15,000 barrels per day, also for the fifth consecutive time, the agency said.

Ethanol stockpiles, meanwhile, continued to fall.

Inventories in the week through April 22 dropped to 23.965 million barrels, the government said.

That’s down from 24.342 million barrels a week earlier and the lowest level since the seven days that ended on January 14, the EIA said in its report.

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3. Red-Flag Warnings Issued For Much of Southern Plains

Red-flag warnings have been issued for much of the southern Plains as dry weather will continue in the region heading into the weekend, according to the National Weather Service.

In southwestern Kansas, winds Friday will be sustained from 20 to 30 mph with gusts of up to 45 mph, the NWS said in a report early this morning.

Relative humidity will fall as low as 9%.

In the Oklahoma and Texas panhandles, southwest winds will range from 20 to 35 mph with gusts up to 45 mph. Humidity will drop to as low as 5%, the agency said.

“A combination of very dry air, hot temperatures, and gusty southwest winds will lead to the potential for dangerous fire weather conditions on Friday,” the NWS said.

Farther north, high-wind watches are in effect for much of central Nebraska and western Kansas starting Saturday morning.

Winds will be sustained from 30 to 40 mph with gusts up to 60 mph possible, the agency said.

“Damaging winds could damage trees and power lines,” the NWS said. “Travel could be difficult, especially for high-profile vehicles.”

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