3 Big Things Today, April 8, 2021
1. Wheat Rises Overnight on Dry Northern Plains Weather
Wheat futures were higher in overnight trading on concerns about dry weather in the northern Plains where spring varieties are grown.
Little or no precipitation has fallen in parts of North Dakota, the biggest producer of spring wheat in the U.S., in the past 60 days, National Oceanic and Atmospheric Association maps show.
The entire state was seeing some sort of drought with 84% facing severe or extreme drought as of March 30, according to data from the U.S. Drought Monitor.
Almost 47% of North Dakota is facing an extreme drought, up from only 27% a week earlier, the monitor said.
Conditions look better in the southern Plains where precipitation gave overwintering plants a boost. As much as four times the normal amount of rain has fallen in parts of Kansas, the biggest U.S. grower of winter wheat, in the past two months, NOAA maps show.
The winter crop was rated 53% good or excellent as of Sunday, the U.S. Department of Agriculture said in its first crop progress report of the year. That’s down from 62% a year earlier. In Kansas, 54% of the crop earned top ratings.
Wheat futures for May delivery gained 7¼¢ to $6.23 ½ a bushel overnight on the Chicago Board of Trade, while Kansas City futures added 9¼¢ to $5.72½ a bushel.
Corn futures for May delivery rose 1½¢ to $5.62 a bushel.
Soybean futures for May delivery fell ¾¢ to $14.08 a bushel. Soymeal fell 60¢ to $408.50 a short ton, and soy oil gained 0.11¢ to 52.96¢ a pound.**
2. Ethanol Production Surges to Highest Since Mid-December
Ethanol output jumped to the highest level in more than three months last week while inventories again declined, according to the Energy Information Administration.
Production of the biofuel surged to 975,000 barrels a day, on average, in the week that ended on April 2, the EIA said in a report.
That’s up from 965,000 barrels a day the previous week and the highest output level since the seven days that ended on Dec. 18, the agency said.
In the Midwest, by far the biggest producing region, ethanol production jumped to an average of 929,000 barrels a day last week from 917,000 barrels. That’s also the most since mid-December, government data show.
That was the entirety of the gains for the week as East Coast production was unchanged at an average of 12,000 barrels a day and both Rocky Mountain and West Coast output were steady at 9,000 barrels a day.
Gulf Coast production declined to 16,000 barrels a day from an average of 18,000 the previous week, the agency said.
Ethanol inventories, meanwhile, dropped to the lowest level in more than four months.
Stockpiles of the biofuel fell to 20.642 million barrels in the seven days through April 2. That’s down from 21.114 million the previous week and the lowest level since Nov. 13, the EIA said in its report.
In other ethanol news, the Renewable Fuels Association said exports of the biofuel totaled 101.7 million gallons in February.
That’s down 38% from January, the RFA said, and was well below the 194.2 million gallons shipped during the same month a year earlier.
3. Dry Weather Leads to More Red-Flag Warnings in Kansas and Nebraska
Dry weather continues in parts of the southern Plains as red-flag warnings have been issued for several counties in the region.
In southwestern Oklahoma where hard-red winter wheat is set to emerge after overwintering, winds this afternoon will be sustained from 15 to 25 mph with gusts of up to 30 mph, according to the National Weather Service.
Relative humidity is expected to drop as low as 10%, the NWS said in a report early this morning.
“Any fires that start will have extreme fire behavior and spread rapidly,” the agency said. “Outdoor burning is not advised.”
The dry weather also is affecting parts of western Nebraska where winds will gust up to 30 mph this afternoon.
Humidity levels are expected to drop as low as 15%.
The strong winds and low humidity may lead to new fires that could spread quickly, the NWS said.