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3 Big Things Today, February 8, 2022

Soybeans, Grains Drop Overnight; Export Inspections of Corn, Wheat Rise.

1. Soybean, Grain Futures Lower in Overnight Trading

Soybean and grain futures plunged in the overnight session on some technical selling.

The most-active soybean contract hit the highest level in eight months yesterday, leading some investors who were long the market, or bet on higher prices, to sell contracts and book profits.

Some rain fell in parts of Brazil and Argentina over the weekend into Monday, which helped with soil moisture.

In Brazil, precipitation helped in central and southern growing areas, and more rain is forecast for southern Minas Gerais, said Donald Keeney, an agricultural meteorologist with Maxar.

Now that the rains have passed, however, soil moisture is expected to decline, he said.

In Argentina, showers in the past few days have improved moisture levels in Buenos Aires, but dry weather will persist in the states of La Pampa, Santa Fe, and Entre Rios, Keeney said.

Wheat futures dropped overnight on favorable conditions in parts of Australia, the world’s second-biggest exporter of the grain.

“The new year has been kind (to mostly kind) to Australian agriculture overall,” NAB Group Economics associate director Phin Ziebell said in a note to clients. “Prices are mostly very strong and seasonal conditions are wetter than average.”

Australia is seeing a La Niña weather event that’s nearing its peak. The weather pattern has brought monsoons to the states of Victoria, South Australia, and New South Wales, while leaving Western Australia drier than normal, Ziebell said.

Investors also are keeping an eye on negotiations between world leaders and Russia in a bid to stop Moscow from invading Ukraine.

French President Emmanuel Macron held talks with Russian President Vladimir Putin to ease tensions.

Russia now reportedly has more than 100,000 troops amassed along its border with Ukraine.

Soybean futures for March delivery dropped 12¾¢ to $15.69 a bushel overnight on the Chicago Board of Trade. Soymeal was up 70¢ to $453.50 a short ton, and soybean oil futures fell 1.54¢ to 63.8¢ a pound.

Corn futures for March delivery lost 4¼¢ to $6.31 a bushel.  

Wheat for March delivery plunged 13¼¢ to $7.55½ a bushel, while Kansas City futures dropped 12½¢ to $7.79¼ a bushel.

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2. Corn, Wheat Inspections Rise Week-to-Week

Inspections of corn and wheat for overseas delivery rose week-to-week while soybean assessments declined.

Corn inspections in the seven days that ended on February 3 totaled 1.05 million metric tons, up from 1.04 million tons the previous week, the U.S. Department of Agriculture said in a report.

That’s still well below the 1.59 million metric tons examined during the same week a year earlier.

Wheat assessments last week were reported at 417,750 metric tons, up from 376,524 tons the previous week. The total was lower than the 485,545 tons inspected at the same point in 2021.

Soybean inspections, meanwhile, dropped to 1.22 million metric tons from 1.42 million a week earlier and 1.91 million tons during the same week last year, the USDA said.

Since the start of the marketing year on September 1, the government has inspected 18.6 million metric tons of corn, down from the 21.6 million tons that were examined during the same time frame a year earlier, the government said.

Soybean assessments since the beginning of September now stand at 37.6 million metric tons, down from 49.4 million tons during the same period last year.

Wheat inspections since the start of the grain’s marketing year on June 1 are now at 14 million metric tons, down from 17.1 million assessed at this point a year ago, the USDA said in its report.

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3. Dry Weather Leads to Red-Flag Warnings in Midwest

Red-flag warnings have been issued for a narrow stretch of land from central South Dakota through eastern Nebraska into north-central Kansas due to dry weather conditions, according to the National Weather Service.

In eastern Nebraska, a warning will take effect at 11 a.m. and last until 6 p.m. tonight amid strong winds and low humidity, the NWS said in a report early this morning.

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

Relative humidity is expected to fall as low as 23%.

In north-central Kansas, winds will be sustained from 25 to 30 mph along with gusts of 40 mph, and humidity is forecast as low as 17%, the NWS said.

Wind advisories are in effect in much of the Dakotas this morning.

In North Dakota, northwest winds are expected to gust up to 65 mph today, the agency said.

“The high winds may blow down large trees and damage roofs, small outbuildings, and signs,” the NWS said. “Power outages are possible. Travel could be difficult, especially for high-profile vehicles. Strong winds can cause blowing dust, reduced visibility and flying debris.”

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