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3 Big Things Today, May 18

Soybeans, Grains Higher Overnight; Export Sales of Corn Rises, Soybeans Fall

1. Soybeans, Grains Jump After China Scraps Sorghum Inquiry

Soybeans and grains jumped overnight after China said it will scrap an anti-dumping probe into imports of U.S. sorghum.

The move from China comes as a delegation from the Asian country is in Washington to continue bilateral trade talks. The spat between the countries, which had threatened to impose tens of billions of dollars worth of tariffs on the other’s goods, has thawed in recent weeks.

“The imposition of anti-dumping and anti-subsidy measures on imports of sorghum originating from the United States would have a widespread impact on consumer living costs, and does not accord with the public interest,” the country’s Ministry of Commerce said in a statement, according to Reuters.

That now leads investors to believe China won’t actually impose import tariffs on U.S. soybeans as it had earlier threatened.

Soybean futures for July delivery jumped 10¢ to $10.05 a bushel overnight on the Chicago Board of Trade. Soymeal futures added $4.70 to $379.80 a short ton and soy oil rose 0.21¢ to 31.15¢ a pound.

Corn futures gained 5½¢ to $4.00¾ a bushel overnight.

Wheat for July delivery rose 8¼¢ to $5.05¾ a bushel in Chicago while Kansas City futures added 8¼¢ to $5.27¼ a bushel.


2. Corn Export Sales Surge Week-to-Week While Soybean Sales Decline                                          

Export sales of corn jumped last week while soybean sales declined, according to the U.S. Department of Agriculture.

Sales of old-crop corn jumped 42% last week to 985,700 metric tons, the USDA said in a report. That’s also up 15% from the prior four-week average.

Japan was the big buyer, taking 401,500 metric tons, followed by Colombia at 122,500 tons and Vietnam at 120,600 tons. Mexico bought 92,700 tons of U.S. corn, and Taiwan took 79,200 tons. An unknown customer canceled a sale for 279,400 tons.

For 2018-2019, sales totaled 129,200 tons with Mexico taking the bulk at 119,200 tons. Taiwan purchased the rest, according to the government.

Analysts had projected old-crop sales from 700,000 to 1 million tons and new-crop sales from 50,000 to 200,000 tons.

Soybean sales dropped to 281,900 metric tons, down 20% week-to-week and 48% from the four-week average, the USDA said.

The Netherlands bought 127,900 tons, Egypt took 97,400 tons, Mexico was in for 85,600 tons, Indonesia purchased 69,000 tons, and Japan was in for 45,000 tons. An unknown buyer bought 224,500 tons.

China was again conspicuously absent from the list of buyers.

New-crop soybean sales totaled 224,700 metric tons as Pakistan purchased 66,000 tons, Mexico was in for 62,000 tons, and an unnamed buyer took 60,000 tons.

Analysts had forecast new-crop sales from 300,000 to 600,000 tons and new-crop sales from 100,000 to 400,000 tons, according to Allendale.

Wheat sales for the 2017-2018 marketing year that ends on May 31 were reported at 63,100 metric tons, up 79% from the previous week but down 50% from the average.

Yemen was the big buyer at 52,700 tons, the Philippines took 52,000 tons, Iraq bought 50,500 tons, Ecuador was in for 35,800 tons, and Japan purchased 28,800 tons, the USDA said. An unknown customer canceled a sale of 143,000 tons, and South Korea nixed a shipment for 22,500 tons.

New-crop sales came in at 131,700 tons as Japan bought 48,000 tons, South Korea purchased 24,800 tons, and Mexico was in for 19,200 tons.

Analysts had expected old-crop sales of wheat from 0 to 200,000 tons and new-crop sales from 100,000 to 300,000 tons.


3. Thunderstorms Will Continue to Move East Into Illinois This Weekend

Thunderstorms will continue to move east slowly out of Iowa into Illinois today and tonight while flooding continues along the Mississippi River.

Some of the storms may be severe with large hail and damaging wind gusts being the primary threats, according to the National Weather Service.

“More storms may fire Sunday afternoon and evening,” the NWS said in a report early Friday morning. “Depending on the amount of heating that occurs during the day and placement of a frontal boundary, there may be a chance for strong storms to develop especially along and south of Interstate 80. Locally heavy rainfall will also be possible with any more organized thunderstorm development on Sunday.”

Strong storms also are expected in the southern Plains.

Thunderstorms are possible across the eastern half of the Oklahoma and Texas panhandles today, and some may turn severe. Wind gusts of up to 70 mph are expected along with large hail, the NWS said.

“Heavy rains can also be expected with the stronger storms, possibly leading to localized flooding or flash flooding,” the NWS said. “An isolated tornado cannot be ruled out.”

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