3 Big Things Today, July 16, 2021
1. Wheat Futures Surge Overnight on Dry Weather
Wheat futures jumped in overnight trading amid poor weather in the Northern Plains where spring wheat is growing.
Severe crop stress is forecast to build in parts of the Dakotas and in the Canadian Prairies, which could reduce global supplies.
“Severe drought losses continue for at least two-thirds of U.S. and three-fourths of Canada spring wheat/canola the next two weeks,” Commodity Weather Group said in a report.
Dry weather in Minnesota, North Dakota, and northern South Dakota are facing the biggest risk of drought stress in the next two weeks, CWG said.
All of North Dakota is facing some sort of drought, with almost 48% seeing extreme or exceptional droughts, the worst-possible ratings, according to the U.S. Drought Monitor. Still, some rain has helped alleviate drought conditions somewhat as that’s down from 52% a week earlier.
About 7.8% of the state was facing an exceptional drought as of July 13, but that’s down from 12% the previous week.
In South Dakota, 90% of the state is seeing drought conditions, little changed from the prior week, though almost 20% is facing extreme or exceptional drought, up from 18%, the monitor said.
In the Canadian Prairies where wheat and canola are grown, some rain is expected in northern Alberta, “but dryness and stress will continue across the majority of the region,” said Donald Keeney, an agricultural meteorologist with Maxar.
Wheat futures for May delivery jumped 11¼¢ to $6.83¼ a bushel overnight on the Chicago Board of Trade, while Kansas City futures surged 10¼¢ to $6.50½ a bushel.
Corn futures for May delivery added 2¢ to $5.58¼ a bushel.
Soybean futures for November delivery gained 10½¢ to $13.90½ a bushel. Soymeal rose $6 to $369.80 a short ton, while soy oil added 0.11¢ to 64.6¢ a pound.
2. Corn and Soybean Sales Decline Week-to-Week
Export sales of corn and soybeans both plunged last week while wheat sales rose, according to the USDA.
Corn sales in the seven days that ended on July 8 totaled 138,800 metric tons, down 20% from the previous week, the agency said. Still, that’s a 31% improvement from the prior four-week average.
Japan was the big buyer at 191,500 metric tons, followed by Mexico at 77,700 tons and El Salvador at 23,000 tons. Jamaica took 18,800 metric tons, and Venezuela was in for 7,300 tons.
An unnamed country canceled cargoes of 104,300 metric tons.
Sales for the 2021-2022 marketing year that starts on Sept. 1 totaled 133,200 metric tons, the USDA said. Exports for the week fell 18% to 1.06 million tons.
Soybean sales last week dropped 66% to 21,700 metric tons. That’s also down 76% from the previous average.
Indonesia purchased 61,500 metric tons from U.S. supplies, France bought 18,500 tons, Japan took 12,600 tons, the Netherlands was in for 10,800 tons, and Cuba took 8,000 tons, the agency said. Unknown buyers nixed shipments of 107,900 tons.
Sales next year were reported at 290,800 metric tons, while exports fell 11% to 197,700 tons.
Wheat sales were more positive, rising 46% week-to-week and 44% from the five-year average, the government said.
Unknown countries bought 132,700 tons, the Philippines was in for 80,100 tons, Japan took 58,900 tons, Mexico purchased 34,500 tons, and Ecuador bought 31,500 tons of U.S. wheat.
Exports for the week fell 5% week-to-week to 365,900 metric tons, the USDA said in its report.
3. Thunderstorms Causing Flooding in Parts of Kansas and Missouri
Strong storms are again rolling through parts of eastern Kansas and western Missouri with flash flood warnings and flood warnings and advisories in effect in the region, according to the National Weather Service.
Heavy rain – as much as 4 inches – has already fallen in some counties leading to flash flooding of small creeks and streams in low-lying areas and those with poor drainage, the NWS said in a report early this morning.
“Gauge reports (early this morning) indicated that flooding was occurring due to slow-moving thunderstorms with very heavy rainfall across the warned area,” the agency said.
Farther west in parts of southwestern Kansas and the Oklahoma and Texas panhandles where hard-red winter wheat is being harvested, storms are possible in the area. No severe weather is expected at this time.
Storms are likely across the panhandles all weekend into early next week, the NWS said.
In eastern Iowa and western Illinois, meanwhile, isolated thunderstorms are possible this afternoon into tonight.
“Severe weather is not expected, but locally heavy rain is possible,” the agency said.
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