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3 Big Things Today, November 18, 2021

Wheat Futures Surge Overnight; Ethanol Production Rises Week-to-Week

1. Wheat Futures Jump in Overnight Trading

Wheat futures surged in overnight trading amid signs of strong global demand for the grain.

Egypt's General Authority for Supply Commodities said this week it was seeking cargoes of 55,000 to 60,000 metric tons of soft or milling wheat from world supplies.

On its website, GASC said it bought 240,000 metric tons of wheat, but didn't provide details.

Turkey's state grain board issued a tender for 385,000 metric tons of milling wheat, Reuters reported, citing European traders. Algeria will take possession of 700,000 to 800,000 metric tons of Russian wheat, the news agency said.

Russia, the world's biggest exporter of the grain, has imposed export taxes that could be raised, pushing up prices. The government may impose further export levies or restrictions that could push buyers to the U.S.

Soybeans and corn also rose in overnight trading on signs of demand.

The U.S. Department of Agriculture said yesterday that exporters reported sales of 132,000 metric tons of soybeans to China for delivery in the 2021-2022 marketing year that started on Sept. 1.

That marks the fourth straight business day that the USDA has announced sales of soybeans or corn to overseas buyers.

Wheat futures for December delivery jumped 12 1/2¢ to $8.45 ½ a bushel overnight on the Chicago Board of Trade, while Kansas City futures rose 10 1/4¢ to $8.46 ¾ a bushel.

Soybean futures for November delivery gained 5 3/4¢ to $12.82 ¾ a bushel. Soymeal added $3 to $371.60 a short ton, while soy oil rose 0.2¢ to 59.36¢ a pound.

Corn futures for December delivery were up 1 3/4¢ at $5.83 ¼ a bushel.

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2. Weekly Ethanol Output Rises While Inventories Fall

Ethanol output rose in the week that ended on Nov. 12 while inventories declined, according to the Energy Information Administration.

Production of the biofuel increased to an average of 1.06 million barrels last week.

That's up from 1.039 million a week earlier, the EIA said in a report.

In the Midwest, by far the biggest producing region in the U.S., output averaged 1.008 million barrels, well above the average of 982,000 barrels the previous week, the agency said.

That composed all of the week's gains.

East Coast output was unchanged at 12,000 barrels a day, on average, the EIA said.

Production in the Rocky Mountain region stayed at 11,000 barres a day while West Coast production was unchanged at an average of 9,000 barrels a day.  

Gulf Coast production was the sole decliner, falling to an average of 21,000 barrels a day from 25,000 barrels the previous week, the agency said.

Ethanol stockpiles in the week through Nov. 12 dropped to 20.081 million barrels.

That's down from 20.286 million barrels a week earlier and the lowest level in three weeks, the EIA said in its report.


3. Temperatures Expected to Drop as Low as 18 in Southern Plains

Freezing weather is on the way to the southern Plains overnight as temperatures may drop as low as 18 degrees Fahrenheit in parts of southwestern Kansas and the Oklahoma and Texas panhandles, according to the National Weather Service.

Temperatures in Boise City, Okla., and Dalhart, Tex., are expected to fall as low as 18 degrees tonight.

Further south in Amarillo and surrounding areas, temperatures will remain in the mid-20s, the NWS said in a report early this morning. This likely will be the first freeze of the season in some areas.

About 81% of the U.S. winter wheat crop has emerged from the ground including 86% in Kansas, 83% in Oklahoma and 71% in Texas, according to data from the Ag Department.

Further east in eastern Oklahoma and northern Arkansas where soft-red winter wheat is growing, temperatures are expected to drop to or below freezing in some areas heading into Friday morning, the NWS said.

Low humidity and strong winds in the area may lead to some fire danger, the agency said.

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