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3 Big Things Today, October 27

Grains, Beans Slightly Lower Overnight; Export Sales Better For Corn, Soybeans

1. Grains, Beans Slightly Lower as Dollar Rebounds on Budget Passage

Grains were slightly lower overnight as the dollar bounced, curbing the appeal of supplies from the U.S.

The greenback rose 0.4% in overnight trading after House Republicans approved the Senate’s budget, which clears a path for Congress to move tax reform along.

While that’s positive the dollar, it essentially makes goods sold in the U.S. currency, including agricultural products, more expensive to overseas buyers.

Export inspections are already behind last year’s pace since the start of the marketing year on September 1, so there’s concern a stronger dollar will further curb shipments to overseas buyers.   

The increase in the value of the greenback comes after it steadily declined this week, so the bounce was more pronounced than it otherwise might have been, according to foreign exchange analysts.

Corn futures for December delivery lost 1¢ to $3.49 a bushel overnight on the Chicago Board of Trade.

Wheat for December delivery declined 1½¢ to $4.30¼ a bushel in Chicago. Kansas City futures lost 1¾¢ to $4.26½ a bushel.

Soybean futures for November delivery declined ½¢ to $9.70¾ a bushel in Chicago. Soy meal rose 10¢ to $312.20 a short ton, and soy oil dropped 0.03¢ to 34.47¢ a pound.

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2. Export Sales of Corn, Soybeans Jump Week to Week, Wheat Sales Disappoint

Export sales of corn and soybeans jumped last week with both topping expectations.

U.S. exporters sold 1.29 million metric tons of corn in the week that ended on October 19, a 3% increase from the prior week and a 32% bump from the previous four-week average, the USDA said in a report.

Unknown buyers led the pack with 357,500 tons in corn purchases, followed by Japan at 257,500 tons, and Mexico at 154,000 tons. South Korea bought 136,500 tons, Spain was in for 120,000 tons, and Peru purchased 87,100 tons.

Analysts had pegged sales from 800,000 to 1.2 million tons.

Soybean sales totaled 2.13 million metric tons last week, up 67% from the previous week and 33% from the prior average.

China was, as usual, the biggest purchaser at 1.58 million tons, followed by Taiwan at 120,400 tons, and Japan at 82,900 tons. Spain purchased 70,900 tons, South Korea was in for 58,600 tons, and Germany bought 52,700 tons, the USDA said.

Market watchers had expected sales from 1.2 million to 1.6 million tons.

Wheat sales disappointed, though they were within the expected range, falling 41% week over week to 360,600 tons. That’s down 16% from the prior four-week average.

Japan was in for 137,400 tons, the Philippines bought 61,800 tons, unknown buyers took 60,200 tons, Vietnam purchased 28,400 tons, and Panama was in for 23,000 tons, according to the USDA.

Analysts had expected sales from 300,000 to 500,000 tons.

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3. Freeze Warnings Stretch From Minnesota to Texas as Winter Arrives in U.S.

Hard freeze warnings are in effect for pretty much all of western Kansas and the Oklahoma and Texas panhandles this morning.

Temperatures overnight were sustained in the upper teens and lower 20s and are expected to stay in that range until well after sunrise, according to the National Weather Service.

Farther east and south, freeze warnings have been issued for a large swath of land stretching from southern Wisconsin and Minnesota all the way down into central Texas, NWS maps show.

Temperatures in Wisconsin are expected to fall into the upper 20s and lower 30s overnight tonight and stay that way well into tomorrow morning, the agency said.

The same weather is expected in central Texas, where temperatures are expected to range from 27˚F. to 32˚F., but may feel colder with wind gusts around 35 mph.

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