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3 Big Things Today, September 29, 2022

Soybeans, Grains Rise Overnight; Ethanol Production Drops to Seven-Month Low

1. Soybean and Grain Futures Surge in Overnight Trading

Soybean and grain futures were higher in overnight trading amid rising barge rates and continued tensions between Ukraine and Russia.

Water levels on the Mississippi River are extremely low in some areas, limiting the flow of barge traffic to export terminals in the Gulf of Mexico.

About 209,600 tons of grain was moved by barge in the week that ended on Sept. 17, down 16% from the previous week, the U.S. Department of Agriculture said in a report. That's still up 24% year-over-year.

About 130 grain barges moved down the river versus 155 a week earlier, the USDA said.

Wheat futures were higher overnight due to the escalation of tensions between Ukraine and Russia in the countries' seven-month war.

Russian President Vladimir Putin is expected to proclaim on Friday that Russia has annexed about 15% of Ukraine, a move that comes after his forces faced shocking defeats in recent weeks.

Ukraine and western countries have disavowed the elections that were passed to approve annexation of the territories.

Putin, along with several other government officials, will sign annexation documents Friday.

Soybean futures for November delivery jumped 10 ¾¢ to $14.19 ½ a bushel overnight on the Chicago Board of Trade. Soymeal gained 40¢ to $413.10 a short ton, while soybean oil gained 1.11¢ to $63.26 a pound.

Corn futures for December delivery rose 3 ¾¢ to $6.74 ¼ a bushel.

Wheat futures for December delivery were up 9 ¼¢ to $9.12 ½ a bushel, while Kansas City futures gained 8 ¾¢ to $9.84 ¾ a bushel.

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2. Ethanol Output Drops to Lowest in Almost Seven Months

Ethanol output plunged to the lowest level in almost seven months while inventories rose for the first time since mid-August, according to data from the Energy Information Administration.

Production dropped to an average of 855,000 barrels a day in the week that ended on Sept. 23, the EIA said in a report.

That's down from 901,000 barrels per day a week earlier, and the lowest since the seven days that ended on Feb. 26.

In the Midwest — by far the biggest producing region — output declined from the previous week's average of 850,000 barrels a day to 799,000 barrels, the government said.

That's the lowest output for the area since Feb. 19.

Still, that was the entirety of the losses, as East Coast production was unchanged at 12,000 barrels a day on average, and Rocky Mountain output remained at 12,000 barrels a day for a second straight week.

West Coast production was unchanged at 8,000 barrels a day, the agency said.

Gulf Coast producers ramped up production to an average of 23,000 barrels a day from 19,000 barrels the previous week.

Ethanol stockpiles, meanwhile, rose to 22.691 million barrels per day in the week through Sept. 23. That's up from 22.501 million barrels the previous week and the first increase since Aug. 19, the EIA said in its report.

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3. Hurricane Ian Slams Florida, Weakens to Tropical Storm

Hurricane Ian continues to devastate Florida this morning after making landfall yesterday with winds in excess of 150 mph.

The storm was downgraded to a tropical storm this morning as winds slowed to around 65 mph, according to the National Hurricane Center.

Ian was bout 40 miles southeast of Orlando at 5 a.m. Eastern Daylight Time and was moving northeast at about 8 mph, the NHC said in an advisory this morning.

Tropical-storm force winds will continue to move northeast and are expected in parts of Georgia and South Carolina today, before continuing into North Carolina tomorrow morning, though the storm is weakening over land, the NHC said.

Meanwhile, in the Midwest, frost advisories have been issued for parts of northern Illinois and southern Wisconsin, the National Weather Service said in a report early this morning.

Temperatures overnight dropped into the low- to mid-30s, which will result in frost formation, the NWS said.

In South Dakota, gusty winds and low humidity may lead to extreme fire danger, starting this afternoon and lasting through the middle of next week, the agency said.

Winds will gust as high as 30 mph and humidity will be low, the NWS said.

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