3 Big Things Today, December 23, 2020
1. Soybean Futures Rise Overnight, Wheat Declines
Soybean futures reached a fresh six-year high in overnight trading on dry weather in South America.
Dry weather has prevailed this week in parts of Argentina, a major exporter of soybeans, which could lead to plant damage, said Donald Keeney, an agricultural meteorologist with Maxar.
“Dry weather across the region this week will allow moisture shortages and stress to build further,” he said in a report.
Some rainfall is expected next week, however, as light rain is expected in parts of Cordoba and Santa Fe states, the report said.
Keeping a lid on price gains ahead of the long holiday weekend are forecasts for rainfall in Brazil, the world’s largest exporter of soybeans.
Rains this week have favored the states of Mato Grosso, Goias, Minas, Sao Paolo, and Mato Grosso do Sul, Keeney said.
Wheat futures were lower overnight on mostly favorable weather in the U.S. southern Plains and some rainfall in Australia.
In the southern Plains, soil moisture remains short but winterkill threats remain low, Keeney said.
Soybean futures for January delivery jumped 9½¢ to $12.59½ a bushel overnight on the Chicago Board of Trade. Soymeal added $1.50 to $415.80 a short ton, and soy oil gained 0.93¢ to 40.89¢ a pound.
Corn futures for March delivery were up 2¢ to $4.45½ a bushel overnight.
Wheat futures for March delivery dropped 1¼¢ to $6.15¾ a bushel, while Kansas City futures lost 2½¢ to $5.76¾ a bushel.
2. Long-Term Crop Forecast Shows Mixed Bag For South American Crops
Rain in Brazil in March should be “decent,” but drier weather in April and May could put the country’s second corn crop at risk, Commodity Weather Group said in its seasonal outlook this week.
In its official forecast, the forecaster said the drier weather in April and May is particularly threatening to farmers in the southern half of the country’s Corn Belt and likely will affect late coffee and sugar growth.
Brazil producers harvest two corn crops each year – its main and safrinha crops. The safrinha, or “little harvest,” is now larger than the full-season corn crop in the South American country, according to the U.S. Department of Agriculture.
In February, it’s likely that dry weather will shift to the southern half of Brazil, which may hinder late soybean and first-crop corn growth, CWG said in its report. Sugarcane and rice production also may be affected.
In Argentina, showers in the spring are expected to be improved from current conditions, which will give double-cropped soybeans a boost but may hinder the corn and soybean harvest, the forecaster said.
While dry weather in February could add to Argentina’s crop losses, showers will gradually improve as the season rolls on, CWG said.
In the so-called Black Sea region where winter wheat is grown, an “active storm track” likely will mean a nice blanket of snow for crops that need protection from the extreme cold.
“Ukraine (and) Russia see a wet spring slow corn (and) spring-wheat seeding but mainly favorable winter-wheat development,” CWG said.
3. Winter Weather Slamming Much of Northern Midwest Wednesday
Blizzard warnings have been issued for a big chunk of land in the Midwest stretching from central Nebraska to the Canadian border, according to the National Weather Service.
In northeastern Nebraska, southeastern South Dakota, northwest Iowa, and southwestern Minnesota, the blizzard warning will remain in effect until 9 p.m. local time.
Snow accumulations are expected to top 7 inches with wind gusts of up to 55 mph, the NWS said in a report early this morning.
“Travel could be very difficult,” the agency said. “Widespread blowing snow could significantly reduce visibility. Strong winds could cause tree damage. The cold windchills as low as -20°F. could cause frostbite on exposed skin in as little as 30 minutes.”
In northern Minnesota and Wisconsin, meanwhile, a winter storm warning is in effect as up to 14 inches of snow is possible in some counties.
Windchills may drop as low as -30°F. today, the NWS said.
“Mixed precipitation is expected today but will transition to all snow, heavy at times, from west to east throughout the day,” the agency said. “In addition to the snow, strong northerly winds will develop from west to east as well and continue into Wednesday night. Blowing snow could result from these winds and quickly reduce visibilities at times.”