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3 Big Things Today, February 26

Soybeans, Grains Higher Overnight; Money Managers Bullish Corn First Time Since August.

1. Soybeans Rise Amid Continued Dry Weather in Argentina, Wheat Higher on Drought

Soybeans were higher in overnight trading on some technical buying and continued dry weather in Argentina.

Not much has changed in the South American country as little relief is expected in soybean- and corn-growing areas in at least the next six to 10 days.

Showers will be limited to the southwestern fringes of the Argentine soybean and corn belts, Commodity Weather Group said in a forecast. It’s going to be warm, as well, with temperatures in the 80s and 90s.

Wheat, meanwhile, is getting a bump from ongoing dry weather in the Southern Plains. Much of the region including far southwestern Kansas, the eastern half of Oklahoma, and almost the entire Texas panhandle are suffering from extreme drought, according the U.S. Drought Monitor.  

Soybean futures for March delivery rose 7¾¢ to $10.55¼ a bushel overnight on the Chicago Board of Trade. Soymeal gained $5.90 to $384.20 a short ton, and soy oil added 0.17¢ to 32.73¢ a pound.

Corn futures for March delivery rose 1¾¢ to $3.68 a bushel in Chicago.

Wheat added 6¢ to $4.70¼ a bushel, while Kansas City futures gained 6½¢ to $4.91¼ a bushel overnight.

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2. Speculators Bullish Corn First Time Since August, Most Positive on Soybeans in 11 Months

Money managers were bullish on corn for the first time in six months and pushed their net-long positions, or bets on higher prices, in soybeans to the highest level since last March.

Speculators were net long by 22,396 corn contracts as of February 20, according to the Commodity Futures Trading Commission. That’s the biggest such position since August 15, the CFTC said in its Weekly Commitment of Traders Report. Investors were net short by 5,216 contracts a week earlier.

In soybeans, investors were net long 92,581 contracts, up from 36,866 contracts seven days earlier. That marks the biggest such position in more than 11 months, government data show.

Adverse growing weather in Argentina that’s threatening to reduce global production has led speculative investors and hedgers to increase their bullish bets on soybeans and corn.

Dry weather in the U.S. Southern Plains, where little or no rain has fallen in at least the past three months, has kept investors bullish in hard red winter wheat.

Money managers were net long by 11,833 HRW contracts as of February 20, according to the CFTC. That’s down from 13, 488 a week earlier, but still bullish overall.  

Investors were net short by 60,157 soft red winter wheat contracts, up from 46,973 contracts a week earlier, the CFTC said.

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3. Flooding a Concern in Midwest Monday While Fire Dangers Forecast in Southern Plains

Flooding is the new concern after excessive rains last week and as snow and ice thaw amid warming temperatures in parts of the Midwest this morning.

Several rivers and streams in Illinois and Indiana are overflowing their banks or are at risk of doing so, according to the National Weather Service. Several inches of rain fell last week, and snow and ice that was on the ground melted, leading several waterways to overflow.

Rare February rains fell in the region on February 19 and February 20, the NWS said. The heaviest amounts fell in east-central Illinois to northwest Indiana where up to 7 inches were recorded.

In the Southern Plains, meanwhile, a red-flag warning is in effect as the area remains extremely dry.

Winds of up to 25 mph sustained are expected today along with relative humidity at around 13%, leading to tinderbox-like conditions, the NWS said. Critical fire weather conditions will start at 11 a.m. and end at about 7 p.m.

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