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3 Big Things Today, June 14

Grain, Soybean Futures Lower Overnight; Ethanol Sales, Stockpiles Higher Week to Week.

1. Corn, Soybeans Lower Overnight After Informa Increases Acres Estimate

Corn and soybeans were lower in overnight trading on expectations for increased acres while wheat declined on signs of slack demand for U.S. supplies.

Researcher Informa reportedly raised its estimate for 2018 corn acres to 88.7 million vs. the USDA’s March outlook for 88 million, while the firm sees soybean acres at 89.9 million, up from the USDA’s 89-million-acre forecast.

Planting has been going well in most of the country, though excessive rainfall in parts of Iowa and Illinois have recently kept farmers out of fields.

The entire U.S. corn crop is in the ground, and 93% of soybeans had been planted as of Sunday, the USDA said.

Wheat prices were lower in overnight trading on some profit taking, as those who were long the market, or bet on higher prices, don’t see much upside as the U.S. winter wheat harvest is under way.

Farm agency France AgriMer said it still sees exports from the country outside the European Union of 8.4 million metric tons while intra-EU sales are pegged at a 12-year high, according to Reuters.

Corn futures for July delivery fell 3½¢ to $3.72½ a bushel overnight on the Chicago Board of Trade.  

Soybean futures for July delivery fell 3¢ to $9.33 a bushel overnight. Soy meal declined $1.50 to $346.00 a short ton, and soy oil rose 0.08¢ to 30.16¢ a pound.

Wheat for July delivery dropped 7¼¢ to $5.09¼ a bushel overnight in Chicago, while Kansas City futures lost 7½¢ to $5.31½ a bushel.

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2. Ethanol Production Rises to Highest in Four Weeks, Stockpiles Jump

Ethanol production rose to the highest in four week while stockpiles jumped in the week that ended on June 8, according to the Energy Information Administration.

Production of the biofuel rose to an average of 1.053 million barrels a day last week, the EIA said in a report. That’s up from 1.041 million barrels a day, on average, the prior seven days and the highest output since May 11.

Inventories, meanwhile, totaled 22.174 million barrels on June 8, the EIA said.

That’s up from 21.897 million a week earlier and the highest level since the seven days that ended on March 30, government data show.

Ethanol has been a hot-button topic as Scott Pruitt, the embattled administrator for the EPA, found out during a trip to farm country this week.

Pruitt and the EPA have been at the center of a debate between ethanol producers and Big Oil. The agency has recently issued several “hardship” waivers to oil refiners that exempt them from ethanol-blending requirements under the Renewable Fuels Standard.

That, in turn, undermines demand for ethanol, which is made from corn in the U.S.

Corn growers in Kansas reportedly told Pruitt they were “mad as hell” about the exemptions being offered by the EPA. In South Dakota, corn growers accused the administrator of intentionally undermining the RFS and the ethanol industry.

In other news, the USDA will release its Weekly Export Sales Report this morning. Analysts expect old-crop corn sales from 600,000 to 900,000 metric tons and old-crop soybean sales from 100,000 to 400,000 tons, according to Allendale. New-crop corn sales are pegged from 200,000 to 400,000, and soybeans are seen at 100,000 to 400,000 tons.

Wheat sales for the marketing year that started on June 1 are expected to come in from 150,000 to 450,000 metric tons, Allendale said.   

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3. Flood Warnings, Heat Advisories In Effect Along Missouri-Illinois Border

Flood warnings and heat advisories don’t usually go together, but that’s what’s happening in counties along the Missouri-Illinois border today.

The heat advisoriy has been issued for a couple of counties in both states where heat indexes are expected to jump to 105˚F., according to the National Weather Service. Humidity is expected to be high, as well, making for sweltering conditions.

Just east of there, flood warnings are still in effect after excessive rainfall earlier this week pushed rives and tributaries over their banks, the agency said.

The scope of the floods has diminished significantly, but a few flooded areas still remain. Travel across flooded roadways isn’t advised.

Flood warnings are still in effect in parts of eastern Iowa today, as well. Scattered thunderstorms are expected in the area, with some possibly producing small hail, the NWS said.

 

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