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3 Big Things Today, January 7, 2022

Soybeans, Grains Lower Overnight; Brazil Bean Estimates Lowered.

1. Soybeans, Grains Drop on Weak Export Sales

Soybean and grain futures were lower in overnight trading after a dismal export-sales report from the U.S. Department of Agriculture.

Sales of soybeans and wheat to overseas buyers both hit marketing-year lows in the seven days that ended on Dec. 30 while corn sales plunged week-to-week, the USDA said.

Export sales of soybeans dropped 382,700 metric tons, down 27% from the previous week and 63% from the same week a year earlier, the agency said in a report.

That’s the lowest since the marketing year started on Sept. 1.

China bought 353,900 metric tons of U.S. soybeans, Mexico took 183,900 tons, Spain was in for 141,100 tons, the Netherlands bought 68,800 tons, and Germany purchased 64,900 tons, the USDA said. Unknown countries, however, canceled cargoes of 625,200 metric tons.

Exports were reported at 1.74 million metric tons, up 1% week-to-week.

Wheat sales fell to 48,600 metric tons, the lowest since the grain’s marketing year started on June 1.

That’s also down 76% week-to-week and 87% from the prior four-week average, the government said.

Italy bought 15,400 metric tons, an unnamed country took 13,900 tons, Mexico purchased 9,600 tons, the Dominican Republic bought 3,200 tons, and Thailand was in for 3,000 tons. Exports for the week fell 37% to 210,900 tons.

Corn sales dropped 80% from the previous week and 81% from the four-week average, the USDA said.

Canada was the big buyer at 150,500 metric tons, Mexico took 115,100 tons, Colombia was in for 90,500 tons, Japan purchased 81,500 tons, and Guatemala took 10,500 tons.

The total would have been higher but unnamed destinations nixed shipments of 212,500 tons. Exports for the week, however, rose 7% to 985,100 metric tons, the government said.

Soybean futures for March delivery dropped 9¾¢ to $13.77½ a bushel overnight on the Chicago Board of Trade. Soymeal fell $3.70 to $407.30 a short ton and soy oil lost 0.04¢ to 58.86¢ a pound.

Corn futures for March delivery fell 4½¢ to $5.99¼ a bushel.

Wheat futures for March delivery lost 9¼¢ to $7.36¾ a bushel, while Kansas City futures plunged 12¾¢ to $7.55¾ a bushel.

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2. Brazil Soybean Crop No Longer Expected to Top Record

Brazilian soybean crop estimates were slashed this week amid dry weather in the South American country.

AgRural said the Brazil soybean crop will no longer be a record and instead will come in at about 133.4 million metric tons, down from a prior outlook for 144.7 million metric tons.

Nine out of the 10 highest temperatures earlier this week were in Rio Grande do Sul, the third-largest producer of beans in the country, where it hit as high as 39°C. (102.2°F.), AgRural analyst Daniele Siqueira said in a tweet.

Some 15% of the crop was blooming, and January and February are “make-or-break” months for the state, she said.

In Parana, the second-largest producing state in the country, half of the crop is filling pods and “losses are huge,” Siqueira said.

Very little rain has fallen in Rio Grande do Sul and western Parana in the past 15 days, AgRural said.

“Recent precipitation was welcome, but not enough to avoid the failure of the soybean crop in western Parana and the loss of potential in other areas of southern Brazil,” Siqueira said. “The soybean situation is getting worse in Rio Grande do Sul too, where the first corn crop has already failed.”

Precipitation has been more plentiful in central and eastern states, the consultancy said. Much of central Brazil is expected to see ample rainfall in the next 10 days, AgRural data show.

AgResource, meanwhile, said it now expects the harvest at about 131 million metric tons, down from a previous outlook for 141 million tons, Reuters reported.

Brazil is expected by the U.S. Department of Agriculture to produce 144 million metric tons of soybeans in the 2021-2022 marketing year, but that estimate is from the December World Agricultural Supply and Demand Estimates (WASDE) report.

The USDA is scheduled to update its estimates on Jan. 12.

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3. Wind-Chill Warnings, Advisories in Effect in Northern Plains

Wind-chill warnings and advisories have been issued for much of the Northern Plains and a stretch of land reaching down into central Illinois, according to the National Weather Service.

In North Dakota and western Minnesota, a wind-chill warning is in effect.

“Four major cities across western and central North Dakota recorded high temperatures in the teens below zero yesterday, making it one of the coldest days over the past couple decades,” the NWS said in a report early this morning. “At Bismarck, this was only the sixth time this century that the daily high temperature has been at least as cold as -10°F., and the first in over four years.”

Wind chills today will fall as low as -50°F. The warning is in effect until noon.

In northern and central Illinois, meanwhile, wind-chill values will range from -20°F. to -25°F., the agency said.

In western Michigan, a winter-storm warning is in effect as up to 6 inches of lake-effect snow may fall in counties along Lake Michigan, NWS maps show.

“The western halves of Mason, Oceana, and Muskegon Counties will be impacted by the heavier snow showers producing accumulations of .5 inch to 1 inch per hour,” the agency said. “Snow-covered and slippery roads are expected.”

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