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3 Big Things Today, November 9

Soybeans, Corn Lower Overnight; WASDE’s Bump in World Corn Stocks Not Completely Unknown.

1. Soybeans, Grains Decline Overnight on Bearish WASDE Numbers

Soybeans and grains were lower after bearish news from yesterday’s World Agricultural Supply and Demand Estimates (WASDE) report.

Soybean prices are lower after the U.S. Department of Agriculture said it expects exports to decline more than expected in October, pushing ending stocks in the U.S. even higher. Global corn inventories were unexpectedly raised from about 159 million metric tons to 308 million metric tons due to changes in China.

The USDA, as expected, lowered its outlook for both soybean and corn yield and production.

Soybean trade with China, or the lack thereof, continues to be a thorn in the side of the entire agricultural complex. Traders are keeping an eye on the ongoing trade war between the U.S. and China as some headway looks like it could be made in the near future as tensions cool.

Soybeans for January delivery fell 3½¢ to $8.75½ a bushel overnight on the Chicago Board of Trade. Soymeal futures were unchanged at $306.10 a short ton, and soy oil declined 0.19¢ to 27.83¢ a pound.

Corn futures for December delivery lost 2¾¢ to $3.70¾ a bushel overnight.

Wheat for December delivery dropped 6¢ to $5.01¾ a bushel while Kansas City futures lost 6¾¢ to $4.90½ a bushel.

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2. USDA’s Global Corn Stocks Estimate Hurts, Not Completely Unknown

The jump in global ending stocks for corn in yesterday’s World Agricultural Supply and Demand Estimates (WASDE) report was bearish the market, but it wasn’t exactly an unknown, according to analysts.

The U.S. Department of Agriculture raised its projection for global inventories at the end of the 2018-2019 marketing year that ends on Aug. 31 to about 308 million metric tons, up from the prior outlook for 159 million metric tons.

Why? China’s stockpiles went from about 59 million tons to 208 million tons, based on the country’s national agricultural consensus.

“It’s important to realize this data was already known to the market heading into today’s report, but the number was still quite bearish vs. expectations,” said Jeff Kaprelian of The Hueber Report.

Despite the global bump, “things looked pretty good” domestically, he said. The USDA lowered its corn yield to 178.9 bushels an acre from 180.7 bushels, in line with Kaprelian’s estimate. Yield could come down as time goes on. Total production was cut to 14.626 billion bushels from 14.778 a month earlier.

Not surprisingly, the USDA cut its export estimates for soybeans to 1.9 billion bushels from 2.06 billion in October, but also cut its production forecast to 4.6 billion bushels from 4.69 billion. Its yield estimate declined to 52.1 bushels an acre from 53.1 bushels an acre.

Domestic ending stocks were pegged at 955 million bushels, up from 885 million a month earlier. Soybean inventories at the end of the 2017-2018 marketing year on Aug. 31 totaled 438 million bushels, according to the USDA.

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3. Snowfall Expected in Parts of Nebraska, Into Iowa, Illinois, NWS Says

More snow is expected in parts of Nebraska and Iowa today with more than an inch expected in some areas, according to the National Weather Service.

The snow will be accompanied by strong wind gusts of up to 40 mph that could reduce visibility, the NWS said in a report early Friday morning.

Farther east, in eastern Iowa and western Illinois, lingering snow with accumulations of up to a .5 inch will occur along the Mississippi River corridor this morning. That could make roads slick.

More snow is expected across the area this afternoon and into the evening.

“Some of these showers may be vigorous, producing short bursts of heavy snow, gusty northwest winds, and periods of sharply reduced visibility,” the NWS said. “In general, additional snow accumulations will be light this afternoon, but the heavier snow showers may produce localized quick accumulations of .5 inch to an inch as they move across the area.”

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