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3 Big Things Today, November 7
1. Grains, Soybeans Little Changed Post-Election, Pre-WASDE
Grains and soybeans were again little changed in the overnight session as investors digest yesterday’s election results and ponder tomorrow’s World Agricultural Supply and Demand Estimates (WASDE) Report from the USDA.
Tuesday’s election went about as pundits expected, with Republicans gaining seats and maintaining control of the Senate while Democrats took back the house. For now, it’s somewhat unclear what impact that will have on rural states.
Analysts said they expect the USDA to slightly lower their corn and soybean yield and production in tomorrow’s report, according to Allendale. Stockpiles, however, are projected to be higher.
Traders in Chicago are also watching trade developments with China. Presidents from both countries have been playing nice recently, boosting hopes that a deal will be done and U.S. agricultural products – mainly soybeans – will again flow to the Asian nation.
Corn futures for December delivery fell ¼¢ to $3.73 a bushel overnight on the Chicago Board of Trade.
Soybeans for January delivery gained 1¢ to $8.85¼ a bushel in Chicago. Soy meal futures rose 80¢ to $312.20 a short ton, and soy oil declined 0.12¢ to 28.02¢ a pound.
Wheat for December delivery gained ¾¢ to $5.12¾ a bushel overnight, while Kansas City futures were unchanged at $5.08 a bushel.
2. Purdue University-CME Group Ag Barometer Jumps as Future Expectations Rise
Purdue University and the CME Group said in its monthly Ag Economy Barometer Report yesterday that farm optimism rebounded amid an upswing in future expectations.
The barometer came in at a 136 reading in October, up from a 114 in September that was the lowest in almost two years. The gauge is now about at the same level it was a year ago.
The current conditions index rose 19 points to a 115 print, while the future expectations index jumped 24 points to a 146 reading. Future expectations are at the highest level in more than a year.
“In October we asked producers about their expectations for corn, soybean, wheat, and cotton prices, looking ahead 12 months,” Purdue and CME said. “In each case, more producers said they expect to see higher prices than lower prices, and for corn, soybeans, and wheat, the ratio of producers expecting higher prices to those expecting lower prices was just over three to one.”
Some 34% said they expect higher corn prices vs. 11% who said they expect prices to fall, while 39% said they foresee higher soybean prices vs. 12%. In wheat, 34% expect higher prices while 10% predict lower prices, the report said.
The new U.S.-Mexico-Canada Agreement (USMCA) proved popular with 62% of farmers saying they were somewhat or completely relieved by the deal, while only 25% said it brought them no relief.
Still, producers remain cautious about making large purchases. The number of those who said now is a bad time to buy costly equipment was down month to month but were still down from a year ago, Purdue and CME said.
3. Winter Weather Advisory Issued For Much of Kansas as 4 Inches of Snow Expected
A winter weather advisory is in effect for much of Kansas where up to 4 inches of snow is expected to fall starting tonight, according to the National Weather Service.
Accumulations are expected to be 1 to 3 inches but heavier locally, the NWS said in a report early Wednesday morning. Parts of central and west-central Kansas will be hit hardest. The advisory is in effect from late Wednesday night through Thursday evening.
Light rain will change to snow throughout the night.
“A winter weather advisory for snow means periods of snow will cause primarily travel difficulties,” the agency said. “Expect snow-covered roads and limited visibilities, and use caution while driving.”
Light snow is also expected in parts of eastern Iowa and western Illinois starting tomorrow and lasting into Friday afternoon and evening, the agency said. Minor accumulations are possible.