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3 Big Things Today, August 20

Soybeans Higher Overnight; Money Managers Reduce Net Shorts in Corn, Beans.

1. Soybeans Higher Overnight on Optimism About China Talks

Soybeans were higher overnight on optimism that China will soon resume imports of the oilseeds from the U.S. after trade talks later this week.

Negotiators from the world’s two largest economies will meet in an attempt to end an escalating trade war in which both sides have imposed $34 billion worth of tariffs on the other’s goods and are set to put duties on another $16 billion in items.

The U.S. is scheduled to impose the $16 billion in tariffs on August 23, but it’s unclear whether the trade talks will alter that plan. President Trump last month instructed the U.S. Trade Representative’s office to find another $200 billion worth of goods on which it could add levies.

Farmers are hoping to see progress on the trade talks so China, the biggest buyer of soybeans, will resume purchases of U.S. oilseeds.

Soybean futures for November delivery rose 9¾¢ to $9.02¾ a bushel in overnight trading on the Chicago Board of Trade. Soy meal futures gained $1.60 to $334 a short ton, and soy oil added 0.25¢ to 28.81¢ a pound.

Corn futures for December delivery fell ¼¢ to $3.78½ a bushel.

Wheat for September delivery fell 7¢ to $5.72¾ a bushel in Chicago, while Kansas City futures lost 4½¢ to $5.87½ a bushel.

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2. Money Managers Curb Net-Short Positions in Corn, Beans; Still Bullish Wheat

Money managers reduced their net-short positions, or bets on lower prices, on corn and soybeans in the week that ended on August 14.

Speculators were net short by 60,139 corn futures contracts last week, according to the Commodity Futures Trading Commission. That’s down from 68,025 contracts seven days earlier.

Investors held a net-short position in soybeans of 62,234 contracts as of August 14, down from 63,066 contracts the prior week, the CFTC said in a report.

Traders and large funds may have reduced their net-short positions amid optimism that China will again open its borders to U.S. soybeans after trade talks this week.

Speculators were still bullish on wheat, however, amid ongoing production issues in several countries including Russia and Australia.

Money managers held net-long positions, or bets on rising prices, of 65,226 soft red winter wheat contracts as of last week. That’s down slightly from 66,351 contracts the prior week.

Net longs in hard red winter wheat rose to 61,421 futures contracts, up from 53,732 contracts seven days earlier, the CFTC said.

The Weekly Commitment of Traders Report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.

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3. Flash Flood Warnings Issued For Parts of Eastern Nebraska, Western Iowa

Flash flood warnings and watches are in effect for much of eastern Nebraska and western Iowa this morning as a storm batters the area.

As much as 3 inches of rain fell in a short time overnight, which has led to flash flooding near the Missouri River, according to the National Weather Service. Low-lying ground and low-water crossings are expected to flood.

Showers and thunderstorms are expected to continue throughout the day. Another 1 to 3 inches of precipitation are expected, which likely will lead to more flash flooding in the area along the Missouri River.

“Heavy rainfall will be possible at least through midday, as showers and a few thunderstorms continue across the area,” the NWS said in a report early Monday morning. “Rainfall up to around an inch is possible, with locally heavier amounts, which likely will produce ponding in poor drainage and urban areas.”

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