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3 Big Things Today, December 20

Grains, Beans Little Changed Overnight; Low Prices, Weak Dollar Spur Demand Hope.

1. Soybeans Touch Higher, Grains Little Changed Overnight

Soybeans were a touch higher, and grains were little changed overnight, keeping with this week’s theme, ahead of the long Christmas weekend.

South American weather is mostly benign with rainfall expected in parts of central and northern Brazil, but potentially expanding into southern states late in the week, Commodity Weather Group said in a report.

In Argentina, rain fell in parts of southwestern Argentina, while precipitation is forecast in the north and east on Friday, according to CWG.

Wheat futures are slightly lower this morning as the cold weather in the U.S. Southern Plains isn’t going to be as bad as thought, which reduces the risk of winterkill, though plants that don’t have a protective layer of snow are still at risk.

Soybean futures for January delivery rose 2½¢ to $9.58½ a bushel overnight on the Chicago Board of Trade. Soy meal was unchanged at $315.20 a short ton, and soy oil added 0.12¢ to 33.34¢ a pound.

Corn futures for March delivery gained ¼¢ to $3.48 a bushel in Chicago.

Chicago wheat for March delivery lost a penny to $4.18½ a bushel overnight. Kansas City futures declined 1½¢ to $4.18½ a bushel.

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2. Low Prices, Weaker Dollar Spark Some Demand For U.S. Soybeans

Low prices and a weaker dollar have given producers some renewed home on the demand front.

The USDA said in a report yesterday that exporters sold 145,000 metric tons of soybeans for delivery in the 2018-2019 marketing year that starts on September 1.

A day earlier, exporters reported an even larger sale of 396,000 tons of soybeans for delivery in the current marketing year that ends on August 31. The agency also reported sales of 168,000 tons of sorghum to China.

Including those amounts, exporters have reported about sales of about 925,000 tons of soybeans in the past four business days. China reportedly bought 257,000 tons on Friday, while Costa Rica was in for 134,503 tons, and unknown buyers purchased 126,000 tons, all for delivery in the 2017-2018 marketing year.

The sales were brought about by low prices and a weaker dollar, which has fallen in each of the past three sessions. A weaker greenback makes U.S. supplies more attractive to overseas buyers.

The sales are helpful, as sales this year are trailing levels seen in 2016. Corn sales since the start of the marketing year on September 1 are down 28% from the same time frame a year earlier, soybean sales are down 16%, and wheat sales are down 9%, according to the USDA.

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3. Southern Plains Dry Weather Will Be Accompanied by Bitter Cold, NWS Says

The dry weather in the Southern Plains will be accompanied by extreme cold starting this weekend, according to the National Weather Service.

Wind chills will fall as low as -10˚F. Saturday night and early Sunday morning across the Oklahoma and Texas panhandles, the NWS said in a report early Wednesday morning.

Along with the increased risk of winterkill, fire officials are warning residents to keep an eye out for elevated risks of wildfires.

Some snow will be associated with the cold front that’s moving in, but an accumulations will remain “light,” the agency said.

 

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