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3 Big Things Today, December 29, 2021

Soybeans, Grains Lower Overnight; China Expected to Approve Domestic GM Corn.

1. Soybeans, Grains Lower in Overnight Trading

Soybean and corn futures were lower in overnight trading on technical selling and some optimism about rain in South America.

Investors likely are squaring their positions ahead of the end of the year, with some who were long the market, or bet on higher prices, selling contracts and liquidating positions before Dec. 31.

On the weather front, some “limited relief” is expected through Friday in parts of central and southeastern Brazil, Commodity Weather Group said in a report yesterday.

Parts of Paraguay and central Brazil may see some drought relief next Tuesday through Thursday, the forecaster said.

“Active rain pattern in northern Brazil aids growth, but some excess rain (and) flooding concerns persist in (the) northeastern 10% to 15%” of soybean-growing areas, CWG said.

Still, it’s not all rosy as drought stress now at 35% to 40% of growing regions in Brazil, the world’s largest exporter of soybeans, and most of Paraguay will narrow only slightly next week, the forecaster said.

Wheat futures were narrowly lower overnight on signs of slack demand for U.S. supplies.

Exports of the grain since the start of its marketing year on June 1 now stand at 10.6 million metric tons, down 22% from the same time frame last year, according to data from the U.S. Department of Agriculture.

Overseas buyers have committed to buy 15.8 million metric tons, also down 22% year-over-year, the USDA said in a report last week.

Soybean futures for November delivery dropped 8½¢ to $13.59½ a bushel overnight on the Chicago Board of Trade. Soymeal fell $1.90 to $407.20 a short ton, while soy oil declined 0.18¢ to 56.49¢ a pound.

Corn futures for December delivery fell 2½¢ to $6.02¼ a bushel.

Wheat futures for December delivery lost 3½¢ to $7.80 a bushel, while Kansas City futures dropped 4¼¢ to $8.17½ a bushel.

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2. China Expected to Approve Domestic GM Corn

China likely will approve use of domestically made genetically modified corn varieties after a public comment period lasting through January 17, the Ministry of Agriculture and Rural Affairs said in a statement.

The companies making the new GM varieties are China National Tree Seed Corp, China Agricultural University, Hangzhou Ruifeng Biotech, and Beijing Dabeinong Biotechnology, the ministry said.

After the public comment period, it’s expected that the government will approve the new varieties.

Still, China doesn’t allow sowing of genetically modified corn or soybeans, though it does allow importation of such varieties for use in livestock feed.

The Asian country is expected to produce 272.6 million metric tons of corn this year, up from 260.7 million tons a year earlier, according to the U.S. Department of Agriculture.

Imports are pegged at 26 million metric tons, making China the world’s biggest buyer of the grain. It’s also the biggest soybean importer.

China will use 214 million metric tons of corn to feed livestock, easily topping the 143.5 million tons the U.S. is scheduled to use for animal feed, the USDA said.

Total corn consumption is seen at 294 million metric tons in the Asian nation, behind only the U.S., which is expected to use 313.2 million metric tons of corn in the 2021-2022 marketing year, the Ag Department said.

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3. Wind-Chill Warnings Issued For Much of Northern Plains

Wind-chill warnings and advisories are in effect for all of North Dakota and parts of Montana, South Dakota, and Minnesota this morning, according to the National Weather Service.

“Life-threatening cold” is expected as wind chills are forecast to drop as low as -50°F., the NWS said in a report early this morning.

“Frostbite on exposed skin (can occur) in as little as 10 minutes,” the agency said. “Don’t be outside too long. When outside, make sure you wear appropriate clothing.”

Farther south in the Southern Plains, meanwhile, red-flag warnings have been issued amid extremely dry weather in the region.

Winds will be sustained from 20 to 30 mph with gusts of up to 40 mph expected, the NWS said.

Relative humidity is forecast to drop as low as 19% today.

"Critical fire weather conditions are expected to develop this afternoon across the west-central and southwestern Texas Panhandle" this afternoon, the agency said.

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