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3 Big Things Today, November 24, 2021

Wheat Futures Rise Overnight; Justice Department Opposes Sugar Mashup.

1. Wheat Futures Higher in Overnight Trading

Wheat futures were higher in overnight trading amid worries about global supplies.

The wheat harvest in Australia has been delayed by continuing rainfall in major growing areas of New South Wales and southern Queensland, Commodity Weather Group said in a report.

Heavy rains in eastern Australia are expected to continue into the weekend, which will further delay collection and raise concerns about damage, the forecaster said.

Russia, the world’s largest exporter of the grain, has imposed export tariffs on wheat shipments in a bid to ensure domestic inventories, and may further add levies and other restrictions on grain movement.

The pace of exports from the country dropped 18% year-over-year since June 1, S&P Global said, citing a report from the Russian Federal Service for Veterinary and Phytosanitary Surveillance.

Turkey was the biggest buyer at 3.4 million metric tons, followed by Egypt at 2.6 million tons and Kazakhstan at 1 million tons, the report said.

Russia is expected to export 36 million metric tons of wheat in the 2021-2022 marketing year, the U.S. Department of Agriculture said in a report earlier this month.

If realized, that would be down from the 38.5 million tons shipped in the previous marketing year, the USDA said.

Corn and soybeans also were higher in overnight trading heading into the Thanksgiving holiday.

Wheat futures for December delivery rose 1¢ to $8.68½ a bushel overnight on the Chicago Board of Trade, while Kansas City futures gained 5¾¢ to $8.89¾ a bushel.

Corn futures for December delivery were up 3¾¢ to $5.92 a bushel.

Soybean futures for November delivery gained 3½¢ to $12.76½ a bushel. Soymeal fell 50¢ to $355.60 a short ton, while soy oil rose 0.61¢ to 60.69¢ a pound.

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2. Justice Department Files Antitrust Suit in Sugar Merger

The U.S. Department of Justice filed a civil antitrust lawsuit to keep U.S. Sugar from acquiring its rival Imperial Sugar, saying the acquisition would leave too much production in the hands of just two companies.

The companies are both multibillion-dollar corporations and the mashup would shrink what the DOJ calls a “cozy sugar industry.” The merger would kill competition in the sugar industry and potentially increase prices, lower quality, and reduce service, the agency said.

“This deal substantially lessens competition at a time when global supply chain challenges already threaten steady access to important commodities and goods,” said Jonathan Kanter, the assistant attorney general of the DOJ’s antitrust division. "The department’s lawsuit seeks to preserve the important competition between U.S. Sugar and Imperial Sugar and protect the resiliency of American domestic sugar supply.”

U.S. Sugar in March agreed to buy Imperial Sugar from Louis Dreyfus, which acquired the company in 2012.

The government’s complaint says U.S. Sugar operates a large Florida refinery and sells its refined products through United Sugars, which is a marketing cooperative it owns along with three other producers. Imperial owns a refinery in Georgia.

The other major player in the southeast is American Sugar Refining, known for its Domino sugars brand name.

“If the transaction is allowed to proceed, United Sugars and Domino would control the vast majority of refined sugar sales in the region, enhancing the likelihood going forward that they will coordinate with each other and refrain from competing aggressively,” the DOJ said in its statement.

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3. Thanksgiving Day Travel Mostly Unaffected By Weather

Strong winds are expected in much of Missouri today with gusts of up to 35 mph forecast, according to the National Weather Service.

Winds will calm as the day goes on but rain chances increase into the evening east of Interstate 35, the NWS said in a report early this morning.

Rains will leave the area early Thursday, leaving cooler weather that will last into the weekend, though travel isn’t expected to be disrupted for Thanksgiving.

In eastern Illinois, meanwhile, some gusty winds will kick around at about 40 mph making travel difficult for some high-profile vehicles, the agency said. No hazardous weather is expected.

The only area that may see some minor travel disruptions is parts of Arkansas.

Winds will be sustained from 10 to 20 mph with gusts of 30 mph or more, the NWS said. Rain chances return to the area this evening along with some colder weather.

A chance of storms will linger in the area Thanksgiving morning before decreasing into the evening, lowering the odds of severe weather, the NWS said.

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