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3 Big Things Today, September 23, 2021

Favorable harvest weather for the Midwest, forecasters say.

1. Corn Futures Lower in Overnight Trading

Soybean, corn and wheat futures traded mostly higher overnight Thursday.

Bob Linneman, Kluis Advisors, says that global weather isn’t much of a concern to the market.

“Grain futures were also higher on the Chinese exchange on the first trading day this week after their holiday Monday and Tuesday. Traders do not seem too concerned with the extreme heat in parts in of South America over the past few days. Temperatures do appear to be returning to more-normal levels according to forecasts. The next major rain event for Brazil is slated for the second week of October,” Linneman stated in a note to customers.

Linneman added, “Traders were focused on the comments from the Federal Reserve announcement yesterday regarding interest rate hikes in 2022. For now, the board is split down the middle. This suggests the probability of rate increases in 2022 are growing as long as employment and inflation data stay within target ranges.”

Wheat futures for December delivery rose 2½¢ to $7.08¼ a bushel, while Kansas City futures fell ½¢ to $6.99½ a bushel.

Overnight, the Dec. corn futures traded 2½¢ lower at $5.23.

November soybean futures traded 3½¢ higher at $12.86. Soymeal lost 90¢ to $340 a short ton, and soy oil gained 0.64¢ to 56.9¢ a pound.

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2. Ethanol Production Falls Even as Midwest Output Increases

Ethanol output dropped in the seven days that ended on Sept. 17 while stockpiles increased, the Energy Information Administration said in a report.

Production declined to an average of 926,000 barrels a day, on average, from 937,000 barrels the previous week, the EIA said. That was the seventh straight week when output averaged less than a million barrels a day.

Output in the Midwest, by far the biggest producing region, bucked the trend and rose to 885,000 barrels a day from 881,000 barrels the previous week, the agency said.

That was the only region that experienced an increase for the week.

East Coast production fell to an average of 9,000 barrels a day, down from 12,000 barrels a week earlier. West Coast output declined to 8,000 barrels a day from 9,000, the EIA said.

Gulf Coast output plunged to 16,000 barrels a day from 23,000 barrels the prior week, and Rocky Mountain production dropped to 8,000 barrels a day, on average, from 11,000 barrels a day a week earlier.

Stockpiles, meanwhile, rose in the week through Sept. 17, the EIA said.

Inventories increased to 20.111 million barrels a day, the government report said. That’s up from 20.01 million barrels the previous week, the agency said.

3. Mostly Dry Conditions For Midwest Through Friday

In the Upper Midwest, showers are possible late Friday, according to the National Weather Service (NWS).

“A few thunderstorms are possible over the Southwest beginning late Thursday and a cold front will bring showers and thunderstorms back into the Upper Midwest and Great Lakes on Friday. Elsewhere, mostly dry conditions are expected through Friday,” the NWS forecaster stated in a daily report.

“Across the Great Lakes, an area of low pressure associated with the front will move slowly north across Lake Huron today – producing additional rains across the upper Great Lakes region, along with strong winds and hazardous beach conditions along the shores of Lake Huron and Lake Michigan on Thursday,” according to the NWS report Thursday.

Showers and thunderstorms will continue to develop along a strong, slow-moving cold front as it moves across the Mid-Atlantic and Northeast on Thursday. A very moist airmass surging north along the front, along with its slow movement will support redeveloping storms, with locally heavy rainfall accumulations likely, according to the NWS report.

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