3 Big Things Today, June 11, 2020

Soybeans, Corn Little Changed; Ethanol Output Jumps to More Than Two-Month High.

1. Soybeans and Corn Little Changed, Wheat Falls Overnight

Soybean and corn futures were little changed, and wheat was lower in overnight trading ahead of today’s World Agricultural Supply and Demand Estimates (WASDE) Report.

The USDA is expected by analysts to peg corn inventories at the end of the marketing year on August 31 at 2.15 billion bushels, up from the previous estimate of 2.1 billion.

New-crop corn carryout is projected to be at 3.36 billion bushels, up from the May outlook for 3.31 billion bushels.

Soybean stockpiles at the end of August are seen at 577 million bushels, down from last month’s forecast for 580 million. New-crop U.S. soybean inventories are likely at 435 million bushels, up from the May outlook for 405 million.

Wheat futures were lower overnight ahead of the report, in which the USDA may raise its global production forecast.

The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) said in a report this week that it expects production to rise to 26.7 million metric tons in the 2020-2021 crop year, a 25% bump from it's prior forecast.

Ample rainfall in some growing areas has broken a years-long drought. If realized, that would be the largest crop in eight years and well above the 10-year average, ABARES data show.

Soybean futures fell 1¢ to $8.64½ a bushel overnight on the Chicago Board of Trade. Soy meal futures lost 30¢ to $288.50 a short ton, and soy oil dropped 0.22¢ to 27.78¢ a pound.

Corn futures were up ¼¢ to $3.26½ a bushel overnight.

Wheat futures for July delivery fell 3½¢ to $5.02¾ a bushel, while Kansas City futures dropped 4¢ to $4.53½ a bushel. 

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2. Ethanol Production Reaches Highest in More Than Two Months, While Stockpiles Fall

Ethanol production jumped to its highest level in more than two months, while inventories again declined, according to the Energy Information Administration.

Output of the biofuel rose to an average of 837,000 barrels a day in the seven days that ended on June 5, the EIA said. That’s up from an average of 765,000 barrels a day the previous week and the highest since the week that ended on March 27.

In the Midwest, by far the biggest producing region in the U.S., production was reported at an average of 802,000 barrels a day, up from 733,000 barrels a week earlier.

That’s the highest level since March 20.

Gulf Coast production rose to 9,000 barrels a day on average, up from 7,000 barrels a week earlier, the agency said.

Rocky Mountain and West Coast output both rose to 8,000 barrels a day from 7,000 barrels the previous week, while East Coast production was unchanged at 10,000 barrels a day, the EIA said.

Ethanol inventories last week fell to 21.802 million barrels.

That’s the lowest level in storage since the seven days that ended on December 27 and down from 22.476 million a week earlier, the agency said in its report.

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3. Flood Warnings Persist Even After Storm Moves North Out of U.S.

Tropical Storm Cristobal has made its way out of the U.S., leaving flood warnings in its wake after storms for several days, according to the National Weather Service.

In eastern Iowa, several rivers including the Mississippi are over flood stage.

“Rainfall heavier than forecast could cause river levels to rise even higher than predicted,” the NWS said in a report early this morning.

At Burlington, the river was at 15.4 feet late Wednesday, above flood stage of 15 feet. Minor flooding is already occurring and is expected to continue.

Flooding is expected to continue today in parts of eastern Iowa and western Illinois. Thunderstorms are possible in the area with some wind gusts of up to 50 mph and small hail expected, the agency said.

Farther south, flooding along the Mississippi River continues, though it may be at its peak.

At Cape Girardeau, the waterway was at 34.7 feet, above flood stage of 32 feet. The river is expected to stay at that level before falling below flood stage next Wednesday, the NWS said.

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