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3 Big Things Today, March 17, 2022

Soybeans, Corn Higher in Overnight Trading; Ethanol Output Falls Slightly.

1. Soybeans, Corn Higher in Overnight Trading

Soybean futures rose in overnight trading as the price of cooking oils rises globally.

Corn was higher while wheat was mixed.

Indonesia reversed course and said it will now impose an export levy on palm oil, which competes with soybean oil on the world market, instead of forcing producers to sell 30% of their planned export volume to domestic buyers.

Palm oil prices have jumped this year amid strong demand, prompting Indonesia, the world’s largest exporter of the product, to impose export restrictions.

The National Oilseed Processors Association said this week its members crushed 165.057 million bushels of soybeans in February. That’s down from 182.216 million bushels a month ago but in line with expectations.

Soybean oil supplies reached the highest level in 22 months, NOPA said.

Wheat futures were mixed in overnight trading as talks between Ukraine and Russia continue.

Ukraine officials are demanding a cease-fire and that Russian troops withdraw. Russian officials continue to demand Ukraine avoid joining NATO and remain neutral.

Kansas City wheat prices were lower in overnight trading on forecasts for precipitation in the Southern Plains.

Precipitation in the region is expected to be “extensive” in the next 10 days, boosting early wheat growth, Commodity Weather Group said in a report.

Soybean futures for delivery rose 9½¢ to $16.58¾ a bushel overnight on the Chicago Board of Trade. Soymeal was down 50¢ to $477.50 a short ton, and soybean oil futures gained 0.85¢ to 74.4¢ a pound.

Corn futures for May delivery rose 8¾¢ to $7.38¼ a bushel. 

Wheat for May delivery fell 1½¢ to $10.67¾ a bushel in Chicago while Kansas City futures lost 8¾¢ to $10.63¾ a bushel.

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2. Ethanol Production Falls While Inventories Surge

Ethanol output fell slightly week-to-week while inventories jumped to the highest level in almost two years, according to the Energy Information Administration.

Production of the biofuel declined to 1.026 million barrels a day, on average, in the seven days that ended on March 11, the EIA said in a report.

In the Midwest, by far the biggest producing region, output fell to an average of 971,000 barrels a day.

That’s down from 977,000 barrels a day the previous week, the agency said.

East Coast production dropped to 11,000 barrels a day, on average, from 12,000 barrels the previous week. Rocky Mountain output declined to an average of 13,000 barrels a day from 14,000 barrels.

That was the entirety of the declines for the week.

West Coast ethanol producers cranked out 9,000 barrels a day, on average, up from 8,000 barrels the previous week, the government said.

Gulf Coast production jumped week-to-week to an average of 23,000 barrels a day, up from 17,000 barrels a day the previous week and the highest level in a month.

Ethanol stockpiles, meanwhile, rose to 25.945 million barrels in the week through March 11.

That’s up from 25.271 million barrels the previous week and the highest since the seven days that ended on April 24, 2020, the EIA said in its report.

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3. Winter Storms Moving From Rockies Into Parts of Kansas

Winter storms are forecast from central Colorado into parts of Kansas today while dry weather is expected in much of the Southern Plains, according to the National Weather Service.

A winter-weather advisory is in effect from 9 p.m. tonight until 7 a.m. Friday morning as up to 3 inches of snow is expected in parts of central Kansas, the NWS said in a report early this morning.

Roads will be slippery and visibility will be affected by blowing snow.

“There is still some uncertainty with temperatures through the evening and overnight hours and their impact on the switch from rain to snow, which would affect snowfall amounts,” the NWS said.

Wind advisories have been issued in parts of the Southern Plains from 10 a.m. to 8 p.m. today as north winds are expected to be sustained at about 35 mph.

Stronger gusts are expected, the agency said.

Red-flag warnings will take effect in parts of southern Oklahoma through most of central and western Texas today as winds will be sustained from 25 to 35 mph with gusts up to 50 mph.

Relative humidity will drop as low as 9%, the NWS said.

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