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3 Big Things Today, February 14

Soybeans, Grains Lower Overnight; Iowa State Has Mixed News on Costs.

1. Soybeans Lower as Investors Book Profits After Yesterday’s 10-Cent Rise

Soybeans were lower in overnight trading as prices continue their see-saw action this week. Grains also declined.

Soybeans added a dime yesterday, reaching a fresh two-month high. Investors who were long the market likely are taking profits after the run-up in prices.

Corn and wheat were also lower, following soybeans.

Fundamentally, nothing has changed. The dry weather in Argentina continues, and Commodity Weather Group said in a report Wednesday morning that forecast rainfall will be “too limited to avert expanding stress.”

In the Southern Plains, it’s still extremely dry, and there’s no relief on the horizon. In the eastern Midwest, however, where soft red winter plants are sown, the weather has been more favorable.

Soybean futures for March delivery fell 2¼¢ to $10.09½ a bushel overnight on the Chicago Board of Trade. Soymeal futures declined $1.80 to $363.40 a short ton, and soy oil rose 0.11¢ to 31.68¢ a pound.

March corn declined 1½¢ to $3.65¼ a bushel in Chicago.

Wheat for March delivery fell 4¢ to $4.56¾ a bushel overnight. Kansas City futures lost 3½¢ to $4.71 a bushel.


2. Land Prices to Fall in 2018, Though Rising Fuel Likely to Offset Most Gains, Iowa State Says

An unheralded report from the Iowa State University Extension office recently had some mixed news for farmers: The price of land and some inputs are going down but the cost of fuel is rising.

The cost to produce soybeans in Iowa will fall $10 per acre in 2018, while the amount it takes to grow corn will drop by $5 an acre from last year, said Alejandro Plastina and Ann Johanns with the ISU Extension and Outreach office.

Still, fuel prices will rise, offsetting most of the declines.

“The drop in prices is attributed to a moderate decline in herbicide, fertilizer, lime, and seed prices, as well as lower expected cash rent costs,” the economists said. “These drops, however, are barely expected to offset increases in machinery, labor, insecticide, and crop insurance costs. This is especially true for corn, as diesel and gas prices are expected to increase fuel costs by $13 to $14 an acre.”

Despite the increased fuel prices, the net cost of production will decline slightly, Plastina and Johanns said in the report.

While the cost of production is down “significantly” since 2012, the declines are dwarfed by falling crop prices.

Corn production costs are down 19%, while soybean output costs have dropped 14%, the economists said. Corn prices, meanwhile, are down 53% since 2012, and soybean prices are off by 35%, according to ISU Extension.


3. Snow, Cold Winds Expected to Move Into Northern Plains on Wednesday

A storm that’s dropping snow in the northern High Plains and northern Rockies likely will expand into parts of the Northern Plains by this evening.

Light snow is expected to fall in western North Dakota with accumulations from 2 to 3 inches, the National Weather Service said in a report early Wednesday morning. North winds may cause blowing snow, which will make travel dangerous.

The storm that will bring the snow is making its way through Montana right now, dropping up to 3 inches of snow with winds gusting to 30 mph, according to the NWS.

Farther east, rain and thunderstorms will move from the lower Mississippi Valley into the lower Ohio Valley today, the agency said. That’s creating a flood threat for the lower Ohio Valley Wednesday night into Friday.

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