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3 Big Things Today, December 14

Soybeans Lower, Grains Little Changed Overnight; Ethanol Production Off Record High

1. Soybeans Lower on Potential For Argentina Rain, Grains Little Changed

Soybeans were lower overnight while grains were little changed in listless trading.

Fundamentally there’s not much to trade on. Dry weather in Argentina may give way to precipitation in the next six to 10 days, Commodity Weather Group has said.

The World Agricultural Supply and Demand Estimates (WASDE) report earlier this week was pretty much spot on what analysts had expected, though the USDA lowered corn inventories and raised bean stockpiles more than expected.

Still, with many traders out for the holidays, it’s likely prices will stay in a range at least through the first of the year.

Soybean futures for January delivery fell 5 ¾ cents to $9.73 ½ a bushel overnight on the Chicago Board of Trade. Soymeal fell $2.10 to $324.70 a short ton, and soy oil declined 0.14 cent to 33.07 cents a pound.

Corn futures for March delivery fell ¼ cent to $3.48 ¾ a bushel in Chicago.

Chicago wheat for March delivery lost ¼ cent to $4.16 ½ a bushel overnight, and Kansas City futures gained ½ cent to $4.16 ¾ a bushel.


2. Ethanol Production Down From Weekly Record, Output Still at Lofty Levels

Ethanol production fell from a record, but only to the second-highest weekly total on record, according to the Energy Information Administration.

Output of the biofuel in the week that ended on Dec. 8 averaged 1.089 million barrels a day, down from the record high of 1.108 million a week earlier, the EIA said in a report.

Stockpiles followed suit, declining to 22.374 million barrels last week, down from 22.544 million seven days earlier, according to the government.

The increased production of ethanol, which hit records two weeks in three, led the U.S. Department of Agriculture to increase its projection on how much corn would be used to make the biofuel.

The USDA said it expects ethanol companies will use 5.525 billion bushels of corn in the 2017-2018 marketing year, up from a prior outlook for 5.475 billion bushels.

That, in turn, led the government to cut its corn-inventories projection at the end of the marketing year on Aug. 31 by 50 million bushels to 2.437 billion.

In other news, the USDA’s export sales report is due out today. Analysts expect corn sales from 700,000 to 1.1 million metric tons, soybean sales from 1.4 million to 2 million and wheat sales from 250,000 to 450,000 tons, according to Allendale.


3. Snowfall Expected on Southern Edge of Lake Michigan; Dry Weather Prevails in Kansas

Snowfall is expected in parts of northern Indiana and southern Illinois and Michigan this morning.

Another 4 inches of snow is expected in areas near Gary and Valparaiso, Indiana, throughout the morning, according to the National Weather Service.

The winter weather likely will make travel difficult, the NWS said.

In the southern Plains it’s a mix of cold weather with potential snowfall in parts of southeastern Colorado, eastern New Mexico and the Oklahoma and Texas panhandles and extremely dry weather that could spark wildfires in parts of southwestern Kansas.

Temperatures are expected to be in the 40s this afternoon in parts of the panhandles, but snow is also in the forecast.

In western Kansas, strong winds and low humidity that are already offering prime conditions for wildfires may worsen this weekend, increasing the danger, the NWS said.  

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