3 Big Things Today, May 26, 2022
1. Grain Futures Decline in Overnight Trading
Grain futures were down again in overnight trading amid ongoing talks to release grain from Ukrainian ports.
Agricultural products have been stuck at ports and other storage facilities since Russia began attacking Ukraine, increasing food insecurity globally.
Russia will reportedly set up a corridor for vessels carrying food products in exchange for reduced sanctions, according to several media reports citing Russian Deputy Foreign Minister Andrei Rudenko.
Before the attacks began in February, Russia was expected to be the biggest wheat exporter in the world while Ukraine was forecast to be the third-largest shipper of the grain.
It's now uncertain where they'll fall in the world rankings as few countries are willing to buy wheat from Russia and Ukraine grain can't get from the field to buyers due to the ongoing war.
Also weighing on prices is favorable weather for crops in much of the United States.
In the southern Plains where hard-red winter wheat is growing, as much as six times the normal amount of rain has fallen in the past seven days, according to the National Weather Service's precipitation page.
The opposite is true in parts of the Midwest including Nebraska, Iowa and South Dakota, where dry weather has allowed farmers to mostly catch up on corn and soybean planting.
About 72% of the U.S. corn crop was in the ground at the start of the week, still behind the prior five-year average of 79%, but closer to normal that it has been for much of the season, according to data form the Department of Agriculture.
Fifty percent of soybeans were planted as of Sunday, just behind the normal 55% for this time of the year.
Spring-wheat planting was 49% finished this week, up from 39% last week but still well behind the average of 83%, the USDA said in a report.
Wheat for July delivery fell 25¢ to $11.23 ½ a bushel overnight on the Chicago Board of Trade while Kansas City futures dropped 22¢ to $12.11 ¼ a bushel.
Corn futures were down 11 1/4¢ to $7.61 a bushel.
Soybean futures for July delivery lost 1¢ to $16.80 a bushel. Soymeal dropped $1 to $423.20 a short ton, while soybean oil futures rose 0.12¢ to 79.04¢ a pound.**
2. Ethanol Production Surges Through May 20
Ethanol output jumped in the seven days through May 20, topping the 1 million-barrel-per-day mark for the first time in almost two months, while inventories declined, according to the Energy Information Administration.
Production of the biofuel rose to an average of 1.014 million barrels a day last week, the EIA said.
That's up from 991,000 barrels a week earlier and the highest level since the seven days that ended on March 25, the agency said in a report.
In the Midwest, by far the biggest producing region, output surged to an average of 960,000 barrels a day from 931,000 barrels a week earlier. That's also the highest since March 25.
Rocky Mountain production rose to 15,000 barrels a day, on average, from 14,000 barrels the previous week, the EIA said.
That was the entirety of the gains as East Coast output was unchanged at 12,000 barrels a day.
Gulf Coast production plunged week-to-week, falling to an average of 20,000 barrels per day from 25,000 barrels a week earlier, the agency said.
West Coast output declined to 7,000 barrels a day from 9,000 barrels.
Ethanol stockpiles, meanwhile, dropped to 23.712 million barrels in the week through May 20. That's down from 23.791 million barrels a week earlier and the lowest output since the seven days that ended on Jan. 14, the EIA said in its report.
3. Storms Forecast For Parts of Iowa, Missouri, and Illinois
Thunderstorms may form in parts of eastern Iowa, northeastern Missouri, and northern Illinois this afternoon, though only a "marginal" risk of severe weather is expected, according to the National Weather Service.
"A few storms could occur this afternoon and tonight," the NWS said in a report early this morning. "Lightning will be the main hazard."
Chances for storms will persist starting again Saturday in the area.
In the southern Plains, meanwhile, a warming trend is expected over the weekend with temperatures topping 100 degrees Fahrenheit, the agency said.
Strong winds, hot temperatures and dry air likely will increase fire danger in western Oklahoma and north Texas, the NWS said.