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3 Big Things Today, July 24, 2020

Wheat Higher in Overnight Trading, Weekly Export Sales of Corn, Beans Mixed.

1. Wheat Futures Climb on Adverse Weather in Producing Areas

Wheat futures were higher in overnight trading Friday as adverse weather may affect global production.

Heat indexes in parts of the U.S. northern Plains are expected to crawl into the triple digits today, according to weather forecasters, which could cause stress on some spring wheat plants.

About 52% of North Dakota, the biggest producer of spring wheat, was facing only abnormally dry or moderate drought conditions, according to the U.S. Drought Monitor.

Commodity Weather Group said the southern Canadian Prairies look drier for the next two weeks, but moisture levels look favorable for now. About 15% of the Canadian wheat crop is at risk from the dry weather, the forecaster said.

Corn and soybeans were little changed overnight despite continued demand. Exporters reported sales of 132,000 metric tons of soybeans to China for delivery in the marketing year that starts on Sept. 1, the U.S. Department of Agriculture said in a report yesterday.

China and other countries have made large purchases of U.S. agricultural products in the past couple of weeks.

Wheat futures for September delivery surged 6¼¢ to $5.35¾ a bushel overnight on the Chicago Board of Trade while Kansas City futures jumped 5¢ to $4.46¼ a bushel.

Corn futures for December delivery gained ¾¢ to $3.36¼ a bushel.

Soybean futures for December delivery rose 1¢ to $9.01 a bushel overnight. Soymeal was unchanged at $297.90 a short ton, and soy oil added 0.14¢ to 30.5¢ a pound.

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2. Export Sales Mixed as Old Crop Drops, New Crop Surges

Export sales of corn in the 2019-2020 marketing year that ends on Aug. 31 plunged week-to-week while new-crop sales soared, according to the USDA.

Corn sales in the seven days that ended on July 16 were reported at 220,600 metric tons, down 76% from the previous week and 56% from the prior four-week average, the agency said in a report.

Japan was the big buyer at 154,100 metric tons, followed by Peru at 106,300 tons, Mexico at 74,600 tons, Colombia at 55,900 tons, and Guatemala at 26,500 tons. Unknown buyers canceled cargoes of 222,900 metric tons.

For 2020-2021, however, sales totaled 2.33 million metric tons as China jumped in and bought 1.96 million tons, the USDA said. Mexico bought 211,000 metric tons of U.S. corn, Colombia was in for 54,000 tons, Honduras took 48,200 tons, and unnamed buyers purchased 40,600 tons.

Soybean sales came in at 365,200 metric tons for the current marketing year, up 17% from the previous week but down 31% from the average, the government said.

For the 2019-2020 marketing year, China bought 209,900 metric tons, the Netherlands purchased 127,700 tons, Egypt was in for 40,700 tons, Peru took 13,000 tons, and Japan bought 12,000 tons. An unknown customer canceled shipments for 63,000 tons, the USDA said.

New-crop beans were reported at 2.3 million metric tons, led by China at 1.49 million tons. An unknown country bought 669,000 tons, Spain was in for 60,000 tons, Taiwan purchased 48,800 tons, and Malaysia took 23,500 tons.

Wheat sales for delivery in the 2020-2021 marketing year that started on June 1 totaled 616,700 metric tons, down 19% from the previous week but up 24% from the average, the agency said.

China was the big buyer at 127,100 metric tons, Yemen bought 99,500 tons, Japan was in for 80,800 tons, Italy took 47,000 tons, and Chile purchased 46,100 tons, the USDA said.

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3. Heat Wave Continues in Parts of Northern Plains Into the Weekend

The heat wave in the northern Plains continues today as an excessive heat warning starts at noon for counties along the North Dakota-Minnesota border, according to the National Weather Service.

Heat indexes this afternoon are expected to top out around 105°F., the NWS said in a report earlier this morning.  

“Extreme heat and humidity will significantly increase the potential for heat-related illnesses, particularly for those working or participating in outdoor activities,” the NWS said.

The eastern two-thirds of South Dakota is in a heat advisory as heat index values are expected to get into the triple digits as well, the agency said. The advisory remains in effect until 9 p.m. Saturday night.

Farther south in central Iowa, warm, humid air is expected to move into the region today with temperatures forecast in the 90s and dewpoints in the mid-70s, which will result in a heat index of up to 105°F. this afternoon, the NWS said.

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