3 Big Things Today, March 10, 2021

Soybeans, Grains Plunge Overnight; USDA Leaves WASDE Mostly Unchanged.

1. Soybeans, Grains Drop Overnight After Quiet WASDE

Soybeans and grains plunged in overnight trading after a lackluster report from the U.S. Department of Agriculture that was little change month-to-month.

The USDA’s World Agricultural Supply and Demand Estimates (WASDE) report showed no changes to the government’s outlook for corn, beans, or wheat.

“Tuesday’s WASDE report from the USDA was a fairly dull event, with marginal changes to the global balances for corn, soybeans, and wheat,” ING’s head of commodities strategy Warren Patterson said in a note to clients after the report was released. “The market was expecting a more constructive release, but the lack of downward revisions to ending stocks saw corn and soybeans trade marginally lower.”

Also weighing on prices overnight is the lack of demand from overseas buyers for U.S. agricultural products.

READ MORE: Soybean prices dive sharply lower Wednesday

Exporters haven’t reported sales of 100,000 metric tons of soybeans, corn, or wheat since March 2, and prior to that it was Feb. 12.

Corn sales in the week that ended on Feb. 25 hit a marketing-year low of 115,900 metric tons, while soybean sales were down 33% from the prior four-week moving average to 334,000 metric tons.

Wheat sales in the week were down 51% from the four-week average, the government said.

Soybean futures for May delivery 15¼¢ to $14.24¾ a bushel overnight on the Chicago Board of Trade. Soymeal lost $4 to $412.60 a short ton, and soy oil declined 0.29¢ to 53.26¢ a pound.

Corn fell 8¾¢ to $5.37 a bushel.

Wheat futures for May delivery dropped 8¢ to $6.48½ a bushel, while Kansas City futures lost 9¾¢ to $6.16¾ a bushel.

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2. USDA Leaves U.S. Forecasts Unchanged, Makes Only Small Adjustments to Global Outlook

The USDA left its domestic forecasts for inventories and exports unchanged and made only minor changes to its global outlook in an unexpectedly quiet WASDE report on Tuesday.

The agency’s corn outlook was completely unchanged with stockpiles standing fast at 1.502 billion bushels and exports on par with February’s projection of 2.6 billion bushels.

Soybean inventories are again expected to fall to 120 million bushels by the end of August, while exports are seen at 2.25 billion bushels, both unchanged from last month’s outlook.

Wheat stocks at the end of the grain’s marketing year on May 31 were again pegged at 836 million bushels and exports were unchanged at 985 million bushels.

“Though the latest USDA forecasts had not been expected to show significant changes for corn and soybean markets, some more minor changes had certainly been anticipated,” Commerzbank’s Michaela Helbing-Kuhl said in a note to clients overnight.

The USDA made some changes to its global forecasts, but even those were minor.

Global corn ending stocks were revised up by a mere 1.14 million metric tons to 287.67 million, government data show.

Soybean inventories, meanwhile, were raised to 83.74 million metric tons from 83.36 million in February.

Brazil production was revised up by 1 million metric tons to 134 million, and the agency’s outlook for Argentina declined by half a million tons to 47.5 million.

Despite the revisions in production, the USDA’s forecast for exports from the Brazil, the world’s largest shipper of soybeans, was unchanged at 85 million metric tons and Argentina’s projected exports remained at 7 million metric tons.

“The USDA appears to feel comfortable with its current predictions, which lie roughly midway between those of the leading South American institutions,” Commerzbank’s Helbing-Kuhl said in her report.

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3. Winter Storms Hit Northern Plains, Dry Weather Affects Southern Plains

Weather maps are lit up Wednesday morning as winter weather hits the northern Plains while dangerously dry weather may affect the southern Plains, according to the National Weather Service.

Winter storm warnings and winter weather advisories have been issued for a large stretch of land from the eastern half of Wyoming to Minnesota’s border with Canada.

In eastern Wyoming, southwestern South Dakota and northwestern Nebraska, snow accumulations of up to 10 inches are expected by the end of the day, the NWS said in a report early this morning.

Roads will become packed with snow and ice and visibility will be low, making travel extremely dangerous in the region, the agency said.

In northeastern South Dakota, meanwhile, 5 to 9 inches of snow is forecast along with winds gusting up to 35 mph.

“Travel could be very difficult,” the NWS said.

Farther south, red-flag warnings indicating extremely dry conditions have been issued for pretty much all of New Mexico northeast through parts of Texas, Oklahoma, and Kansas into southwestern Iowa, the weather maps show.

In southwestern Kansas and the Oklahoma and Texas panhandles, relative humidity is expected to drop as low as 7% today with sustained winds of 20 to 30 mph gusting to 40 mph.

“Any fires that develop may be difficult to control,” the NWS said. “Outdoor burning is not recommended. Use extreme caution if engaging in activities that could start a fire.”

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