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3 Big Things Today, November 16

Soybeans Slightly Lower Overnight; Weekly Ethanol Production Little Changed.

1. Soybeans Modestly Lower Overnight, Corn Unchanged

Soybeans were slightly lower in overnight trading on new fears that any trade deal between the U.S. and China, if hammered out later this month at the Group of 20 meeting in Argentina, will take a long time to improve demand for the oilseeds.

China sent a letter to the Washington with a trade proposal. That’s positive because it shows signs that the sides are willing to negotiate. The letter, however, missed on several key points the White House wanted to see, curbing the odds that a deal will be worked out during the G20 meeting.

Accumulated exports of soybeans since the start of the marketing year on September 1 are down 41% from the same period in 2017 to 8.62 million metric tons, the USDA said. Total commitments to buy U.S. supplies are off by 31%.

The U.S. and China have been involved in a mostly tit-for-tat trade dispute for months, slapping tariffs on tens of billions of dollars’ worth of each other’s goods. Soybean sales this year have suffered as China was, prior to the dispute, the biggest buyer of U.S. supplies.

Soybeans for January delivery fell 1¢ to $8.87¾ a bushel overnight on the Chicago Board of Trade. Soy meal futures gained $1.30 to $306.70 a short ton, and soy oil fell 0.23¢ to 27.46¢ a pound.

Corn futures for December delivery were unchanged at $3.67½ a bushel overnight.

Wheat for December lost 2½¢ to $5.03 a bushel, while Kansas City futures declined 1¢ to $4.79 a bushel.


2. Ethanol Production Little Changed, Inventories Rise; NOPA Crush Jumps to Record

Ethanol production was little changed, while inventories rose for a second straight week, according to the Energy Information Administration.

Output fell slightly to an average of 1.067 million barrels a day in the seven days that ended on November 9, the EIA said in a report.

In the Gulf Coast, production fell by 5 million barrels a day, on average, the government said. Those losses were offset by gains in the Midwest output, where output rose by 2 million barrels a day, and on the West Coast, where production was up 1 million barrels.

Stockpiles, meanwhile, rose for a second straight week, increasing to 23.514 million barrels last week, according to the EIA.

Ethanol demand has shown signs of slipping lately as exports in September fell to 89.9 million gallons, the Renewable Fuels Association said earlier this month. That’s a 25% decline from the month earlier and the lowest volume in a year, but by historical standards it was a relatively strong month, the RFS said.

In other news, NOPA crush was reported yesterday at a record 172.35 million bushels in October, easily topping analyst estimates and up almost 5% from last year, according to Allendale. Since the start of the marketing year on September 1, soybean crush is up 11% from the same time frame last year.


3. Up to 8 Inches of Snow Expected in Parts of North Dakota as Winter Storm Hits

It’s starting to look like winter in several parts of the country as winter storm warnings and weather advisories are in effect for much of the Northern Plains.

Snow fell yesterday in parts of the southeastern Midwest, blanketing parts of Missouri and southern Illinois in snow, according to the National Weather Service.

Today, heavy snow is expected with accumulations of up to 8 inches in parts of North Dakota, the NWS said in a report early Friday morning. A winter storm warning is in effect from 6 a.m. CST until 8 p.m., the agency said.

“Travel could be very difficult,” the NWS said. “Areas of blowing snow could significantly reduce visibility.”

In southern Minnesota, meanwhile, snowfall of 2 to 4 inches is expected today, with some areas possibly getting 5 inches. Brisk northerly winds will curb visibility as winds will cause blowing snow.

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