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3 Big Things Today, December 9, 2021

Wheat Futures Drop Overnight; Ethanol Production Jumps to Five-Week High.

1. Wheat Futures Plunge, Soybeans Lower Overnight

Wheat futures plunged in overnight trading while soybeans were lower ahead of today’s World Agricultural Supply and Demand Estimates (WASDE) report from the U.S. Department of Agriculture.

Snow is expected in northern parts of the Southern Plains starting tonight, which will improve soil moisture for hard-red winter wheat that’s growing in the area, said Donald Keeney, an agricultural meteorologist with Maxar.

The storm will move across the High Plains tonight into Friday with snow forecast after midnight tonight, the National Weather Service said in a report. Still, little accumulation is expected.

Wheat in Kansas, the biggest producer of the grain in the U.S., was rated 58% good or excellent at the start of the week, according to the USDA. That’s down from 62% a week earlier.

Topsoil moisture in Kansas was 48% adequate or surplus, while subsoil moisture was 51% was adequate or surplus, the agency said earlier this week.

Soybeans are down overnight as the USDA is expected to raise its outlook for domestic and global ending stockpiles in today’s WASDE report.

Inventories likely will be pegged at 352 million bushels by the government agency, which would be up from the November outlook for 340 million bushels, according to a survey by Reuters.

Global inventories will be seen at 104.1 million metric tons, up from 103.8 million a month earlier, the survey said.

Corn inventories in the U.S. will probably be forecast at 1.487 billion bushels, down slightly from last month’s outlook for 1.493 billion bushels. Global stocks are pegged at 304.5 million metric tons, up from 304.4 million tons in November.

Underpinning prices, however, is persistent demand for U.S. supplies in recent weeks.

Exporters reported sales of 1.84 million metric tons of corn to Mexico and 130,000 tons of soybeans to China, the USDA said in a report yesterday. That marks the seventh straight business day the government has reported large sales of U.S. ag products to overseas buyers.

Wheat futures for March delivery dropped 10¾¢ to $7.83¾ a bushel overnight on the Chicago Board of Trade, while Kansas City futures lost 10¼¢ to $8.01¾ a bushel.

Soybean futures for November delivery fell 5¾¢ to $12.55¼ a bushel. Soymeal was up 20¢ to $357.40 a short ton, while soy oil declined 0.66¢ to 54.89¢ a pound.

Corn futures for December delivery were up ¼¢ to $5.87½ a bushel.

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2. Ethanol Production Jumps to Five-Week High

Ethanol output rose to the highest level in five weeks while inventories also gained in the seven days that ended on Dec. 3, according to the Energy Information Administration.

Production averaged 1.09 million barrels a day, up from 1.035 million the previous week and the highest level since Oct. 29, the EIA said in a report.

In the Midwest, by far the biggest producing region, output rose to 1.03 million barrels a day, up from 978,000 barrels a week earlier and also the highest since Oct. 29.

Rocky Mountain output was reported at 14,000 barrels a day, on average, from 11,000 barrels a week earlier.

West Coast production was up to 9,000 barrels a day from 7,000 barrels, the EIA said.

East Coast output was unchanged week-to-week at 12,000 barrels a day, where it’s been for the past month.

The lone decliner for the week was Gulf Coast production, which dropped to an average of 25,000 barrels a day from 27,000 barrels, the agency said.

Ethanol stockpiles in the week through Dec. 3 rose to 20.464 million barrels.

That’s up from 20.129 million barrels a week earlier and the highest level since the seven days that ended on Aug. 27, the EIA said in its report.


3. Winter Storms Rolling Through Northern Plains, Parts of Iowa

Winter storms will roll through parts of the Northern Plains starting this evening, bringing heavy snow and strong winds, according to the National Weather Service.

In northern Nebraska and southern South Dakota, as much as 10 inches of snow is possible starting this evening and lasting through much of Friday, the NWS said in a report early this morning.

Wind gusts are forecast as high as 30 mph.

Farther east in parts of northern Iowa, a few counties in southern Minnesota and areas in southwestern Wisconsin, a winter weather advisory and a winter storm watch have been issued.

A mix of rain, sleet, and snow will fall today with up to a foot of snow possible, the NWS said.

“For the Winter Weather Advisory, a mix of freezing rain, sleet, and snow transitioning to all snow,” the agency said. “Snow accumulations a trace to 1 inch. For the Winter Storm Watch, heavy snow possible. Total snow accumulations of 5 to 12 inches are possible.”

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