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3 Big Things Today, September 19, 2022

Wheat Futures Lower Overnight; Speculators Raise Bullish Best on Corn, Beans

1. Wheat Futures Drop in Overnight Trading

Wheat futures plunged in overnight trading as more agricultural exports come out of Ukraine despite threats to end an agreement allowing shipments from the war-torn country.

Ten ships sailed from Ukrainian ports on Sunday, carrying almost 170,000 metric tons of agricultural products, Reuters reported, citing the country's Agriculture Ministry.

Since an agreement was reached in late July, about 3.7 million metric tons of agricultural products have been exported from the country's ports, the report said.

Ukraine is forecast to export 20.5 million metric tons of wheat in the 2022-2023 marketing year, the U.S. Department of Agriculture said last week. That's up from the month-earlier outlook for 19.5 million metric tons. If realized, that would still be well below the 33 million metric tons shipped a year earlier, the USDA said.

Russia attacked Ukraine in late February. A deal to export grain and other ag products from the country was reached in late July.

Vladimir Putin, the president of Russia, has recently said he would consider ending the agreement allowing ships to sale from Ukraine's ports because they were being sent to wealthy European countries instead of poor areas where food is scarce.

Kiev countered by showing the destinations for each ship that sailed from its ports.

Global wheat production is now seen at 783.9 million metric tons, up from the August outlook for 779.6 million metric tons. That will push ending stockpiles to 268.6 million metric tons this year, up from the prior projection of 267.3 million tons, the USDA said.

Wheat futures for December delivery lost 16 3/4¢ to $8.43 a bushel overnight on the Chicago Board of Trade, while Kansas City futures were down 16¢ to $9.19 ¼ a bushel.

Corn futures for December delivery fell 2¢ to $6.75 ½ a bushel.

Soybean futures for November delivery were up 3¢ to $14.51 ½ a bushel. Soymeal added $3.10 to $424.80 a short ton, while soybean oil fell 0.57¢ to $65.39 a pound.

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2. Speculative Investors Raise Net-Longs in Corn and Beans

Net-long positions, or bets on higher prices, surged in both corn and soybeans last week, according to data from the USDA.

Bullish bets on corn increased to a net-227,675 futures contracts in the seven days that ended on Sept. 13.

That's up from 210,231 contracts a week earlier and the higher level since May 17, the agency said in a report.

Investors raised their net-longs in soybeans to 114,761 contracts from 99,569 contracts a week earlier, marking the highest level since June 28.

In wheat, speculators raised their bullish bets to a net-16,875 hard-red winter contracts, up from 11,052 contracts and the largest such position since the seven days that ended on July 5, the government said.

Money managers reduced their net-short positions, or bets on lower prices, in soft-red winter wheat to 22,665 futures contracts from 23,434 contracts the previous week.

That's the smallest bearish position for the grain since Aug. 16, the 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.

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3. Extremely Dry Weather Expected in Parts of Wyoming, South Dakota

Red-flag warnings have been issued for parts of eastern Wyoming and southwestern South Dakota amid extremely dry conditions, according to the National Weather Service.

Winds will be sustained from 5 to 15 miles an hour with gusts up to 25 miles an hour, the NWS said in a report early this morning.

Relative humidity will fall as low as 11%.

"The combination of gusty winds and low relative humidity would produce critical fire weather conditions," the agency said.

Further east, dense fog advisories have been issued for parts of eastern Minnesota and western Wisconsin this morning, The fog will dissipate, but thunderstorms may roll through the area late today.

Storms are forecast in the region Tuesday and possibly Wednesday, the NWS said.

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