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3 Big Things Today, December 28
1. Soybeans Higher on Light Volume, Trade Uncertainty
Soybeans turned higher in overnight trading Friday as light volume and uncertainty over trade leave traders unsure which direction to take heading into 2019.
Traders this week have been lamenting the lack of purchases from China, but the shutdown could be masking any purchases the Asian nation – or any other customer of the U.S. – may be making.
While there were reports that the Department of Agriculture’s weekly export sales report would be delayed indefinitely due to the government shutdown, a note on the agency’s website said it will be released today and was only delayed due to Christmas.
Volume is low as some traders head off for a four-day weekend ahead of New Year’s Day on Tuesday, and a lack of data has left some investors wary of taking strong positions one way or another.
Corn and wheat futures also were higher.
Soybean futures for March delivery rose 5¢ to $8.87½ a bushel overnight on the Chicago Board of Trade. Soymeal futures added $1.60 to $309.90 a short ton, and soy oil gained 0.12¢ to 27.75¢ a pound.
Corn futures rose 1½¢ to $3.76 a bushel overnight.
Wheat for March delivery added 2¾¢ to $5.13¼ a bushel and Kansas City futures gained 2½¢ to $4.97½ a bushel.
2. Corn Output Next Year Likely to Rise on Increased Acreage, Illinois Economists Say
Corn production in the next marketing year likely will rise on higher planted acreage, though yield and total use are projected to be lower, leaving ending stockpiles in the 2019-2020 marketing year little changed, University of Illinois researchers said.
Acreage is pegged at about 91.8 million in the coming planting season, up from 89.1 million the previous year, the researchers said. Yield is expected to be around 174.2 bushels an acre, leaving production at about 14.7 billion bushels.
Total use is seen at around that same amount – 14.7 billion bushels – which would put ending stockpiles at the end of the next marketing year on Aug. 31, 2020, at about 1.76 billion bushels, almost on par with the prior year’s outlook from the Department of Agriculture for 1.78 billion bushels.
Soybeans, meanwhile, likely will be planted on about 85.7 million acres, well below 2018-2019’s 89.1 million, the University of Illinois said. Yield is pegged at 49.2 bushels an acre, down from the 52.1 bushels expected this year.
That puts total production at about 4.2 billion bushels, down from the 4.6 billion producers harvested this year, the researchers said. Total use is seen at about 4.11 billion bushels, virtually unchanged year-over-year, leaving ending stocks up slightly from this year’s 955 million.
“A considerable amount of uncertainty remains due to trade issues with China and South American crop prospects in 2019,” the Illinois economists said.
3. Severe Winter Weather Conditions Expected in Northern Midwest Friday
Winter weather conditions are expected to continue for much of northeastern South Dakota and parts of Minnesota and northern Wisconsin today, according to the National Weather Service.
A blizzard warning remains in effect until 9 a.m. in several South Dakota counties. While no more snowfall is forecast, winds are gusting as high as 45 mph, the NWS said in a report early this morning.
Roads are expected to be slippery and blowing snow could “significantly reduce visibility,” the agency said.
A winter storm warning is in effect for much of central and southern Minnesota, where freezing drizzle is expected throughout the morning. Blowing snow and wind gusts up to 40 mph will make travel hazardous or impossible, the NWS said.