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3 Big Things Today, October 3

Wheat Futures Rise Overnight; USMCA Will Allow Limited Access to Canada Dairy Market.

1. Wheat Futures Higher Overnight on Russia Concerns

Wheat futures rose overnight on reports that exports from Russia may be curbed by the country’s agriculture safety watchdog, while corn and beans were up modestly.

The agency, called Rosselkhoznadzor or Federal Service for Veterinary and Phytosanitary Surveillance, warned 30 grain-loading ports may be temporarily suspended due to violations of phytosanitary rules, Reuters reported overnight.

Russia has been the source of several recent rumors saying the country would limit exports due to weak production this year amid adverse weather. So far, no export limits have been implemented.

Corn and beans were slightly higher overnight as excessive rainfall likely will delay the U.S. harvest.

Flooding continues to be a problem in much of eastern Iowa where several rivers and streams are over their banks, according to the National Weather Service. Another round of storms is set to hit the area starting this afternoon, the NWS said.

The corn crop is 26% harvested, up from 16% a week earlier and the prior five-year average of 17%, while soybeans are 23% collected, up from 14% last week and the average of 20% for this time of year, according to the USDA.

Wheat for December delivery rose 2¾¢ to $5.22 a bushel overnight on the Chicago Board of Trade, and Kansas City futures added 2½¢ to $5.25 a bushel.

Corn futures for December gained 1¢ to $3.68½ a bushel in Chicago.

Soybeans for November delivery rose 3¢ to $8.69 a bushel overnight. Soy meal futures lost 10¢ to $315 a short ton, and soy oil gained 0.18¢ to 29.84¢ a pound.

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2. New U.S.-Canada Deal Will Expand Access to Canada’s Protected Dairy Markets

The U.S. and Canada earlier this week signed a new trade deal that ironed out several issues including new rules on access to the Canadian dairy market.

Canada has very strict controls on dairy production and, obviously, imports of milk and milk products. Under the new agreement, which will not be called the North American Free Trade Agreement and instead has been named the U.S.-Mexico-Canada Agreement (USMCA), Canada will loosen some of those restrictions.

It will now allow access of up to 3.6% of Canada’s dairy market to be phase in over the next six months and eliminates a pricing policy that negotiators had said was unacceptable and protectionist.

President Trump called it a “win” for the U.S., but the amount of access was well below what had originally been sought by negotiators, according to reports.

Naturally, the Dairy Farmers of Canada were quite unhappy with the deal, issuing a scathing statement after it had been reached.

“Canadian dairy farmers woke up Monday to realize that their worst nightmare had become a crushing reality,” the group said. “Despite multiple assurance to the contrary, the Trudeau government sacrificed them once again at the altar of flawed trade negotiations. Faced with an American administration that prefers to dump their problem on our doorstep rather than fix it itself, the Trudeau government has failed to stand up for Canada’s family-owned dairy farms and homegrown dairy. Even worse, this deal will allow Americans to dictate our dairy policies.”

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3. Harvest May Be Delayed in Several Parts of Midwest as Thunderstorms Roll Through

Several parts of the Midwest, where producers are trying to harvest their corn and soybeans, likely will see rainfall today.

In eastern Nebraska and western Iowa, flooding is occurring along the Missouri River with more rain possible this morning. Nonsevere storms are expected in the area, which will exacerbate the flooding, according to the National Weather Service.

The wet weather will continue the rest of the week and into early next week, with intermittent thunderstorms and “several chances” for heavy rainfall, the NWS said in a report early Wednesday morning.

Flooding is a significant problem in eastern Iowa already, and more showers are on the way today.

In northern Illinois, there’s a “significant” thunderstorm risk today and tonight, the NWS said.

“A line of showers and storms will reach north-central Illinois this evening,” the agency said. “The strongest storms may produce damaging winds up to 60 mph and hail. Storms will weaken as they move across the outlook area tonight; however, heavy rain is possible with the storms.”

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