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3 Big Things Today, March 28, 2022

Wheat Futures Plunge Overnight; Speculators Boost Net-Long Positions in Corn.

1. Wheat Futures Drop in Overnight Trading

Wheat futures plunged in overnight trading as investors who held bullish bets liquidate positions on the prospects of talks between Ukraine and Russia.

Ukrainian officials have said they’re willing to discuss becoming a neutral state ahead of another round of talks with Russia.

Russian attacks continued for a 33rd straight day. Talks have been slow with little headway made, though the sides are set to meet in Turkey on Tuesday, according to several media reports.

Soybeans and corn also were lower in overnight trading ahead of the planting intentions report from the U.S. Department of Agriculture that’s scheduled for Thursday.

The grain stocks report also will be released Thursday.

Prices also were lower as some rain is expected this week in parts of the Midwest. Precipitation will focus on the southeastern corner of the Corn Belt, though wetness is expected to the east prior to early corn planting, Commodity Weather Group said in a report.

Wheat for May delivery plunged 39¢ to $10.63¼ a bushel overnight on the Chicago Board of Trade while Kansas City futures dropped 35¼¢ to $10.75½ a bushel.

Soybean futures for delivery fell 15¾¢ to $16.94¾ a bushel. Soymeal was down $3.60 to $484.30 a short ton and soybean oil futures lost 0.61¢ to 74.14¢ a pound.

Corn futures for May delivery were down 10½¢ to $7.43½ a bushel. 

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2. Investors Boost Bullish Bets on Corn, Beans

Money managers raised their net-long positions, or bets on higher prices, in corn to the highest level in almost 11 months while also bumping their bullish bets on beans, according to the Commodity Futures Trading Commission.

Investors held a net-371,914 corn-futures contracts in the seven days that ended on March 22, the CFTC said in a report.

That’s up from 361,250 contracts a week earlier and the highest since April 20 of last year.

Speculators held 164,248 soybean-futures contracts last week, up from 161,928 contracts a week earlier, the government said. That’s the highest level in three weeks.

In wheat, fund managers and other large investors held a net-long position of 45,328 hard-red winter contracts last week.

That’s up from 43,808 contracts a week earlier and the highest level since the week that ended on January 4, the agency said.

Soft-red winter wheat futures bucked the trend as speculators reduced their bullish bets, holding a net-22.692 contracts as of March 22, down from 24,967 contracts the previous week, the CFTC said in its report.

The weekly Commitments of Traders report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.

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3. Extremely Dry Weather Expected in the Southern Plains

Extremely dry weather is plaguing the Southern Plains as strong winds and low humidity persist in the area, according to the National Weather Service.

In the Oklahoma and Texas panhandles, southwest winds are expected to be sustained from 15 to 25 mph with gusts up to 35 mph, the NWS said in a report early this morning. Relative humidity is forecast as low as 5% today.

Red-flag warnings have been issued for the area.

Winds tomorrow will gust up to 60 mph, while humidity will hover around 12%, the agency said.

In southwestern Kansas, winds are expected from 20 to 30 mph with gusts of up to 45 mph, the NWS said. Relative humidity is pegged as low as 15%.

Red-flag warnings also are in effect for parts of eastern Wyoming and western Nebraska.

Winds will gust up to 30 mph in the region and humidity will drop from 10% to 15%, the agency said.

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