3 Big Things Today, August 9
1. Wheat Falls Overnight on Easing Heat in Europe, Argentina Outlook
Wheat futures were lower in overnight trading, falling from the highest prices in three years, as the heat wave in Europe breaks and on reports that Argentina crops are looking good.
Temperatures in France are expected to ease late this week following a round of intense heat. Cooler air is expected Friday and into the weekend after temperatures in France and Germany reached almost 100˚F., according to Accuweather.
Cooler weather is too late for some crops as Strategie Grains cut its outlook for European Union soft wheat production to 128 million metric tons from about 130 million projected in late July, which is down about 10% from the prior year’s harvest.
The hot air will instead be replaced with thunderstorms, which could turn severe and lead to flash flooding or damaging winds, the forecaster said.
In Argentina, meanwhile, growers who are finishing planting reported moist soils and cool weather that’s giving crops a boost. While it’s still early in the season, the Buenos Aires Grain Exchange has projected a crop of 19 million metric tons.
The USDA has pegged output in Argentina at 19.5 million tons, which would top a record set in the 2007-2008 marketing year.
Wheat for September delivery fell 5¢ to $5.65 a bushel in overnight trading on the Chicago Board of Trade. Kansas City futures dropped 6¾¢ to $5.77½ a bushel.
Corn futures rose ¾¢ to $3.84¾ a bushel overnight.
Soybean futures for November delivery fell 3¢ to $9.07½ a bushel. Soy meal declined $1.30 to $336.10 a short ton, and soy oil added 0.02¢ to 28.93¢ a pound.
2. Ethanol Production Surges to Eight-Month High; Wheeler Set to Visit Iowa, Learn About Ethanol
Ethanol production jumped to the highest in eight months, and stockpiles surged in the week that ended on August 3, according to the Energy Information Administration.
Output of the corn-based biofuel in the U.S. surged to an average of 1.1 million barrels a day last week, the EIA said in a report. That’s up from 1.064 million barrels during the prior seven-day period and the highest amount since the week that ended on December 1.
Stockpiles, meanwhile, rose to 22.923 million barrels last week, the highest level since the seven days that ended on March 16, government data show.
Ethanol has been somewhat of a political lightning rod in recent months as the industry faces off against refiners and the Environmental Protection Agency in a bid to limit so-called hardship waivers from the EPA that allowed refiners to forego their obligations under the Renewable Fuels Standard.
Scott Pruitt was replaced as head of the agency after a series of scandals, and newly appointed acting Administrator Andrew Wheeler has taken over.
Wheeler will visit the Iowa State Fair next week after the state’s congressional delegation invited him to learn more about ethanol and biodiesel, the Des Moines Register reported. Iowa is the biggest producer of ethanol and biodiesel.
3. Thunderstorms Forecast in Parts of Central Illinois, Severe Weather Possible in Oklahoma
Thunderstorms are possible in parts of central Illinois today and tonight, but the threat of severe weather is low, according to the National Weather Service.
Storms that form, however, are expected to produce gusty winds and brief bouts of heavy rainfall as well as potentially dangerous lighting, the NWS said in a report early Thursday morning.
The chance for storms will continue into Friday, mainly during the late afternoon and evening, and some of the stronger fronts that form may produce hail and possibly damaging winds.
In Oklahoma, meanwhile, scattered showers and thunderstorms are expected this afternoon.
“Some of the storms could become strong to marginally severe, producing wind gusts of up to 60 mph and hail up to the size of nickels,” the NWS said. “Heavy rain and frequent lightning will also be a concern.”