3 Big Things Today, July 6

Soybeans Slightly Higher Overnight; Ethanol Industry Celebrates Pruitt Resignation.

1. Soybeans Slightly Higher Overnight After Thursday’s Drop

Soybeans were just north of unchanged this morning after again falling near 10-year lows on Thursday amid an escalating trade war between the U.S. and China.

The U.S. Trade Representative kicked off tariffs on $34 billion worth of Chinese goods, which led Beijing to initiate its own duties on an equal amount of U.S. goods, including soybeans.

Soybean prices leveled overnight after dropping yesterday, as bargain hunters and end users try to fill needs amid relatively low prices.

The trade war could escalate as President Trump on Thursday said the U.S. may target more than $500 billion worth of Chinese goods for tariffs – encompassing almost everything imported from the Asian country.

Soybean futures for November delivery were up 1¢ to $8.56¾ a bushel overnight on the Chicago Board of Trade. Soy meal rose $1.10 to $325 a short ton, and soy oil lost 0.02¢ to 29.01¢ a pound.

Corn futures lost ¼¢ to $3.52 a bushel in Chicago.

Wheat for September delivery fell 2¢ to $5.03½ a bushel, while Kansas City futures declined ½¢ to $5.02¾ a bushel overnight.

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2. Weekly Ethanol Production Down, Industry May See Change After Pruitt Resignation

Ethanol production declined and stockpiles rose in the week that ended on June 29, according to the Energy Information Administration.

Output of the biofuel last week totaled 1.067 million barrels, on average, the EIA said in a report. That’s down from 1.072 million barrels the prior week, which was the highest since December.

Inventories, meanwhile, increased to 21.975 million barrels last week, up from 21.674 million seven days earlier and the highest level in three weeks, according to the government.

Environmental Protection Agency Administrator Scott Pruitt resigned on Thursday, which was celebrated by the ethanol industry. Along with several scandals that included questionable spending on travel and security, Pruitt often found himself to be a lightning rod for criticism of how he handled the ethanol industry and renewable fuels standard.

The sheer number of waivers he issued to refiners looking to dodge responsibilities related to the RFS were brought up many times by Corn Belt lawmakers including Charles Grassley, Joni Ernst, and David Young, all from Iowa.

The Renewable Fuels Association said in a statement that Pruitt had been “waging war” on the RFS, the biofuels industry, and farmers who’d helped President Trump get elected.

“So, that sound you hear is a collective sigh of relief coming from the Midwest,” the RFA said in a statement. “We look forward to working with Acting Administrator Andy Wheeler, whose long career focusing on policies that recognize economic growth and environmental protection are not mutually exclusive is not undermined by an unmistakable anti-ethanol, anti-farmer bias.”

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3. Weather Maps Relatively Quiet Though Some Areas Remain Flooded

Weather maps are relatively quiet after several days of heat advisories and flood warnings in the Midwest.

Some flooding is occurring in parts of northwestern Iowa and southern Minnesota, but it appears it’s mostly isolated, according to the National Weather Service. In central Nebraska and Kansas, a dense fog advisory is in effect.

Recent rainfall in the Midwest favored Iowa, Minnesota, western Wisconsin, and northern Illinois, according to MDA Weather.

More precipitation is expected in central and southeastern parts of the Corn Belt, boosting soil moisture for growing plants, the forecaster said.

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