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3 Big Things Today, May 10

Soybeans, Grains Higher Ahead of WASDE; Ethanol Output Rises to Seven-Week High.

1. Soybeans, Grains Higher Overnight Ahead of WASDE Report

Soybeans and corn were higher overnight ahead of today’s World Agricultural Supply and Demand Estimates (WASDE) Report from the USDA.

The report is the first in which the government will give its first supply-and-demand projections for 2018-2019 crops.

“Trade is expecting a sizeable reduction in ending stocks for corn in 2018-2019, mostly due to the smaller planted acres,” Allendale’s Paul Georgy said in a morning note. “Soybean stocks could hold steady with 2017-2018. Trade also is keying in on the number USDA will be using for Argentine corn production and Brazilian soybean production.”

Soybean futures for July delivery rose 4¢ to $10.19¾ a bushel overnight on the Chicago Board of Trade. Soy meal added $3.20 to $389 a short ton, while soy oil gained 0.04¢ to 31.07¢ a pound.

Corn rose 1¼¢ to $4.04 a bushel overnight.

Wheat for July delivery gained 2½¢ to $5.13 a bushel overnight, while Kansas City futures added 3½¢ to $5.35 a bushel.

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2. Ethanol Production Jumps to Seven-Week High, Inventories Decline                                            

Ethanol production jumped to the highest level in seven weeks while inventories of the biofuel declined, according to the Energy Information Administration.

Output in the week that ended on May 4 totaled 1.04 million barrels a day, on average, the EIA said in a report. That’s up from 1.032 million barrels the prior week and the most since March 16.

Inventories, meanwhile, dropped to 21.964 million barrels last week. That’s down from 22.142 million barrels seven days earlier, agency data show.

Lawmakers are trying to hammer out a deal regarding blending requirements that appease both the ethanol and oil industries. The White House said earlier this week that a deal had been struck that would allow sales of E85 year-round while allowing oil companies to use exports to meet their commitments to the Renewable Fuels Standard.

It’s unclear, however, whether a deal had indeed been made after comments from Iowa Senator Charles Grassley, who seemed to indicate that discussions about the RFS were ongoing.

In other news, the USDA is scheduled to release its Weekly Export Sales Report this morning.

For delivery in the 2017-2018 marketing year, analysts expect between 700,000 and 1 million metric tons of corn sales, 300,000 to 600,000 tons of soybean sales, and 0 to 350,000 tons of wheat sales, according to Allendale. New-crop sales are pegged from 50,000 to 300,000 tons for corn, 100,000 to 300,000 tons for beans, and 200,000 to 350,000 for wheat, the researcher said.  

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3. Flooding Still an Issue Along Mississippi River, More Rain Expected in Iowa

Flooding is still a problem along Iowa’s border with Wisconsin and Illinois, according to the National Weather Service.

The Mississippi River is over its banks near Prairie Du Chien and Dubuque, Iowa, all the way south well past Quincy, Missouri, according to the National Weather Service.

More rain is expected in northeastern Iowa today with 1 to 2 inches expected. Some areas may see higher amounts locally.

That will likely cause flooding to intensify on the Kickapoo River in southwestern Wisconsin, the Upper Iowa River and the Turkey Rver in northeastern Iowa, and the Cedar River in northeastern Iowa and southeastern Minnesota, the NWS said.

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