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3 Big Things Today, October 24, 2022

Soybeans, Grains Lower Overnight; Investors Curb Bullish Bets on Corn

1. Soybean, Grain Futures Decline in Overnight Trading

Soybean and grain futures were lower in overnight trading on calls for in growing areas in South America.

Rain is expected in Argentina this week, which will boost soil moisture for recently planted crops. Precipitation is forecast in parts of La Pampa, Buenos Aires and Santa Fe, among other growing areas.

In Brazil, rain was expected over the weekend in northern regions, which should improve conditions, though some dry areas are forecast in central areas will help alleviate some concerns about being too wet, according to a report from Maxar.

Brazil, the world's largest exporter of soybeans, is forecast by the U.S. Department of Agriculture to produce 152 million metric tons of the oilseeds in the 2022-2023 marketing year.

If realized, that would be up from 127 million metric tons a year earlier, USDA said in a report last week.

Argentina, meanwhile, is projected to produce 51 million metric tons, up from 44 million tons last year, the agency said.

Soybean futures for November delivery dropped 14¢ to $13.90 ½ a bushel overnight on the Chicago Board of Trade. Soymeal fell $3.20 to $414.70 a short ton, while soybean oil lost 0.24¢ to 71.26¢ a pound.

Corn for December delivery was down 4 ¼¢ to $6.80 a bushel.

Wheat futures for December delivery lost 7 ¾ ¢ to $8.43 a bushel, while Kansas City futures dropped 5 ¾ ¢ to 9.42 ¼ a bushel.

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2. Speculators Reduce Bullish Bets in Corn Futures

Money managers cut their net-long positions, or bets on higher prices, in corn last week, while bullish bets on beans rose slightly, according to data from the Commodity Futures Trading Commission.

Investors held a net-239,358 corn futures contracts in the seven days that ended on Oct. 18, down from 254,553 contracts a week earlier, CFTC said in a report. That's the first decline in three weeks.

Net-longs in soybeans were up narrowly to 66,749 futures contracts last week from 65,606 contracts seven days earlier.

In wheat, hedge funds and other large investment firms reduced their bullish bets in hard-red winter futures to a net-26,136 contracts, the government said.

Investors, meanwhile, raised their net-short positions, or bets on lower prices, in soft-red winter wheat to 23,020 contracts last week, up from 19,889 contracts a week earlier.

That's the largest bearish position since Sept. 13, CFTC said in its report.

The weekly Commitment of Traders report from the Commodity Futures Trading Commission shows trader positions in futures markets.

The report provides positions held by commercial traders, or those using futures to hedge their physical assets; noncommercial traders, or money managers (also called large speculators); and nonreportables, or small speculators.

A net-long position indicates more traders are betting on higher prices, while a net-short position means more are betting futures will decline.


3. Freezing Weather Expected Overnight in the Southern Plains

Freeze watches have been issued for tonight into tomorrow for parts of the southern Plains, according to National Weather Service maps.

Temperatures are forecast to drop as low as 26 degrees Fahrenheit in far southeastern Colorado where hard-red winter wheat is growing, NWS said in a report early this morning.  

In the Oklahoma and Texas panhandles, temperatures may drop to 27 degrees overnight, the agency said.

In the northern Plains, winter-storm warnings and winter-weather advisories are in effect throughout the morning as snow falls. An additional 2 inches on top of what's already fallen is expected in western North Dakota, NWS said.

Winds are gusting as high as 45 mph.

In Montana, heavy snow is falling with expected accumulations of up to 3 inches, along with winds gusting to 50 mph, NWS said.

"Whiteout conditions are likely at times and will combine with the heavy wet snow to make travel treacherous," the agency said.

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