3 Big Things Today, January 22, 2021

Soybeans, Grains Plunge Overnight; Cattle, Hog Slaughter Up Year-Over-Year.

1. Soybean and Grain Futures Plunge in Overnight Trading

Soybeans and grains plunged in overnight trading on favorable South American weather and as soybean planting in Argentina nears completion.

Rainfall late Monday into Tuesday and Thursday into Friday will keep stress on soybeans and corn “very limited” in Argentina, Commodity Weather Group said in a report.

While there’s an expected break in the precipitation in the 11- to 15-day outlook, it’s unlikely stress will build thanks to next week’s rain.

Stress in parts of Brazil is limited to 15% of soybean- and corn-growing areas due to rain in parts of southern states, though dryness is forecast to rebuild in the northeast, CWG said.

Prices also are under pressure as IHS Markit, formerly Informa, said planting for both beans and corn will increase in 2021.

Soybean planting this year is now pegged at 90.1 million acres, the firm said, according to media reports. If that comes to fruition, that’d be up 7.8% year-over-year.

Yield is expected at about 52 bushels an acre for production of 4.64 billion bushels.

Corn seeding is now seen by IHS Markit at 94.2 million acres, up from the U.S. Department’s projection of 90.8 million a year earlier, according to the reports.

The firm forecast yield of 181 bushels an acre for total output of 15.7 billion bushels.

Soybean futures dropped 28½¢ to $13.41¾ a bushel overnight on the Chicago Board of Trade. Soymeal was down $8.10 to $430.10 a short ton and soy oil lost 0.57¢ to 42.86¢ a pound.

Corn for March delivery fell 9¢ to $5.15¼ a bushel.

Wheat futures for March delivery lost 16¢ to $6.44¾ a bushel, while Kansas City futures declined 13½¢ to $6.22¼ a bushel.

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2. Cattle and Hog Slaughter Rose Moderately Last Month, USDA Says

U.S. cattle and hog slaughter both rose modestly in December while beef production improved and pork output declined, according to the USDA.

Cattle slaughter last month was reported at 2.78 million head, a 1% increase from the same month in 2019, the agency said in a report. That average live weight increased 14 pounds to 242 pounds.

Beef production rose 3% year-over-year to 2.32 billion pounds.

Hog slaughter in December increased 1% to 11.5 million head, the government said. The average live weight came in at 294 pounds, a 6-pound increase year-over-year.

Pork output was 2.51 billion pounds, a 3% increase from December 2019, the government said.

Commercial red meat production in the U.S. rose 3% year-over-year to 4.85 billion pounds last month.

Red meat output in 2020 totaled 55.7 billion pounds, up 1% from previous year, the USDA said in its report. Beef production was down slightly from 2019, pork output was up 2%, veal processing fell 14%, and lamb and mutton production dropped 7%.

The USDA also will release its weekly export sales report, a day late due to the observance of Martin Luther King Jr. Day on Monday.

Analysts are expecting corn sales from 600,000 to 1.2 million metric tons, soybean sales from 1.1 million to 2.1 million metric tons, and wheat sales from 250,000 to 650,000 metric tons, according to researcher Allendale.

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3. Winter Weather Advisory Issued in South Dakota as 2 to 5 Inches of Snow Expected

A winter weather advisory has been issued for parts of eastern South Dakota and southwestern Minnesota, according to the National Weather Service.

From 2 to 5 inches of snow is expected starting overnight and lasting into Saturday evening, the NWS said in a report early this morning.

Road conditions are expected to deteriorate with streets becoming slippery in spots.

Winds likely will be sustained from 15 to 25 mph, which may result in blowing or drifting snow, the agency said.

Farther south in the southern Plains, meanwhile, some strong thunderstorms are expected in parts of southern Oklahoma and western north Texas this weekend, weather maps show.

“A few strong to marginally severe thunderstorms are possible across portions of southern Oklahoma and western north Texas late Sunday into Sunday night,” the NWS said. “Hail up to the size of quarters is the main threat.”

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