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3 Big Things Today, November 11, 2021

Soybean Futures Modestly Higher Overnight; Ethanol Output Falls From Record.

1. Soybean Futures Slightly Higher in Overnight Trading

Soybeans were modestly higher overnight on some signs of demand while wheat futures backed off after yesterday’s surge.

Exporters yesterday reported sales of 22,000 metric tons of soybean oil to an unnamed country, the U.S. Department of Agriculture said in a report.

On Tuesday, exporters reported sales of 150,000 metric tons of corn to Colombia, and last week said Egypt bought 100,000 metric tons of soybeans from the U.S., the Ag Department said.

Also underpinning soybean prices is the USDA’s World Agricultural Supply and Demand Estimates (WASDE) report in which the government lowered its outlook for soybean production in the 2021-2022 marketing year that started on Sept. 1.

Output is now forecast at 4.425 billion bushels, the agency said in its report on Tuesday. That’s down from its October outlook for 4.448 billion bushels. Yield is now pegged at 51.2 bushels an acre from the previous projection for 51.5 bushels an acre.

The USDA’s stockpiles estimate for soybeans, meanwhile, was raised to 340 million bushels from 320 million. U.S. exports are now seen at 2.05 billion bushels from 2.09 billion bushels.

Wheat futures were lower in overnight trading amid some profit taking after prices yesterday surged almost a quarter in Chicago.

Global ending stockpiles of the grain at the end of the marketing year on May 31 are now forecast by the USDA at 275.8 million metric tons, down from the previous outlook for 277.2 million tons.

That’s also down from 280 million tons a year earlier, government data show.

Prices yesterday jumped 24¼¢, which may have led some speculative investors who were long the market, or had bet on higher prices, to sell contracts and liquidate their positions.

Soybean futures for November delivery rose 2¢ to $12.18¾ a bushel overnight on the Chicago Board of Trade. Soymeal gained $1.10 to $343.50 a short ton, while soy oil lost 0.41¢ to 58.73¢ a pound.

Wheat futures for December delivery fell 3¢ to $8 a bushel, while Kansas City futures dropped 1¾¢ to $8.14¾ a bushel.

Corn futures for December delivery were down 1¢ at $5.68¼ a bushel.

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2. Ethanol Production Drops From a Record

Ethanol output last week fell from a record while inventories rose, according to the Energy Information Administration.

Production of the biofuel dropped to an average of 1.039 million barrels a day in the week that ended on Nov. 5, the EIA said in a report.

That’s down from 1.107 million barrels a day, a record, a week earlier and the lowest level since the seven days that ended on Oct. 8, the agency said.

In the Midwest, by far the biggest producing region, output averaged 982,000 barrels a day, down from 1.051 million barrels the previous week and also the lowest since Oct. 8.

East Coast production declined to 12,000 barrels a day, on average, from 13,000 barrels the previous week.

That was the entirety of the losses as West Coast output was unchanged at 9,000 barrels a day, the EIA said.

Gulf Coast production rose to an average of 25,000 barrels a day last week from 24,000 barrels a week earlier. Rocky Mountain output also was up, averaging 11,000 barrels a day from 10,000 barrels the previous week.

Stockpiles, meanwhile, rose for the second straight week to 20.286 million barrels, the agency said.

That’s up from 20.129 million barrels a week earlier and the largest amount in storage since the seven days that ended on Sept. 3, the EIA said in its report.

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3. Winter Storms, Blizzards Expected in Northern Plains

Winter storms and blizzard warnings have been issued in parts of the Northern Plains while parts of Kansas are seeing extremely dry weather, according to the National Weather Service.

In northeastern South Dakota, a blizzard warning will take effect at 6 p.m. CT tonight and last until Friday evening, the NWS said in a report early this morning.

As much as 6 inches of snow are expected in the area along with winds gusting up to 55 mph, the agency said.

Winter weather advisories and high-wind warnings also will take effect in the area. In much of Minnesota, from 1 to 3 inches of snow are possible with winds up to 55 mph.

In northern Minnesota, a winter storm warning has been issued from noon today to the same time tomorrow as 4 to 6 inches of snow are forecast, the NWS said. Winds will gust as high as 40 mph tonight.

“Light snow will fall this morning into midday but mostly melt on road surfaces,” the agency said. “Main accumulations start mid to late afternoon and through tonight.”

In northern Kansas and southern Nebraska, meanwhile, a red-flag warning has been issued amid extremely dry weather.

Winds are expected to be sustained from 15 to 25 mph with gusts of up to 40 mph, the NWS said. Relative humidity is expected to fall as low as 17% in the region.

The rest of western Kansas is likely to see extremely dry weather as well.

“Dry and gusty northwest winds will lead to critical to near-critical fire weather conditions for today,” the agency said.

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