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3 Big Things Today, October 28, 2021

Soybean Futures Modestly Higher Overnight; Weekly Ethanol Production Surges.

1. Soybeans Slightly Higher in Overnight Trading

Soybeans were modestly higher in overnight trading while grains were lower.

Signs of demand have been trickling in the past couple of weeks, underpinning prices.

Exporters said China bought 199,000 metric tons and Mexico purchased 125,730 metric tons of U.S. soybeans, the Department of Agriculture reported Tuesday.

Wheat futures were lower overnight after Egypt, the world’s largest importer of the grain, said Wednesday it bought Russian, Ukrainian, and Romanian wheat.

The North African country bought 180,000 metric tons from Russia, 120,000 tons from Ukraine, and 60,000 tons from Romania, according to Egypt’s General Authority for Supply Commodities.

The purchases were expected, though Egypt reportedly was looking at wheat from several other countries including the U.S.

Traders also are watching government reports as the USDA is scheduled to release its weekly export sales report this morning and its agricultural prices report tomorrow afternoon.

Soybean futures for November delivery rose 2¼¢ to $12.52 a bushel overnight on the Chicago Board of Trade. Soymeal added 40¢ to $331.30 a short ton, while soy oil was down 0.36¢ to 61.06¢ a pound.

Corn futures for December delivery lost ¼¢ to $5.56¾ a bushel.

Wheat futures for December delivery fell 2¼¢ to $7.57½ a bushel, while Kansas City futures dropped 3½¢ to $7.79¼ a bushel.

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2. Ethanol Production Hits Second-Highest Level Ever

Ethanol output last week jumped to the second-highest level on record while stockpiles declined, according to the Energy Information Administration.

Production of the biofuel surged to an average of 1.106 million barrels a day in the week through Oct. 22, the EIA said in a report.

That’s up from 1.096 million a week earlier and the second-highest output behind only the 1.108 million barrels a day, on average, reported in the week that ended on Dec. 1, 2017.

In the Midwest, output came in at 1.051 million barrels a day last week, up from 1.041 million a week earlier and the highest average since record keeping began in 2010, government data show.

East Coast production rose to an average of 12,000 barrels a day last week, up from 11,000 a week earlier.

Rocky Mountain output was unchanged at 10,000 barrels a day, and West Coast production remained at 9,000 barrels, on average, the EIA said.

Gulf Coast production was the outlier, falling to an average of 23,000 barrels a day from 24,000 barrels the previous week.

Ethanol inventories, meanwhile, declined week-to-week.

Stockpiles totaled 19.925 million barrels a day, down from 20.08 million barrels the previous week, the EIA said in its report.


3. Winds, Low Humidity Create Dry Conditions in Southern Plains

High-wind warnings and red-flag warnings have been issued for much of the southern Plains this morning, creating tinderbox-like conditions, according to the National Weather Service.

Winds starting this morning will be sustained from 35 to 40 mph in parts of southwestern Kansas and the Oklahoma panhandle with gusts of up to 60 mph, the NWS said in a report.

“Damaging winds will blow down trees and power lines,” the agency said. “Travel will be difficult, especially for high-profile vehicles.”

The high-wind warning starts at 9 a.m. Central and ends at 7 p.m.

In the Texas panhandle, meanwhile, winds will be sustained from 25 to 35 mph with gusts of up to 60 mph, the NWS said.

Relative humidity is forecast to drop as low as 15%, creating extremely dry conditions. A red-flag warning will be in effect from mid-morning through 7 p.m. this evening, the agency said.

Farther east, winds will range from 15 to 25 mph and gust up to 40 mph in parts of southern Missouri and northern Arkansas today, the NWS said.

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