3 Big Things Today, September 9, 2022
1. Soybean, Grain Futures Rise in Overnight Trading
Soybean futures jumped and grains were higher in overnight trading on concerns about dry weather in parts of the U.S. Corn Belt and on uncertainty about what will happen with Ukraine shipments.
Little or no rain has fallen in much of the Dakotas, Minnesota, Nebraska, northwestern Iowa and northern Missouri in the past two weeks, according to data from the National Weather Service's precipitation page.
About 86.3% of Nebraska was facing drought conditions as of Sept. 6, up from 84.6% a week earlier, the U.S. Drought Monitor said in a report yesterday.
Just over 10% of the state is facing extreme drought -- the worst-possible rating -- up from 6.1% seven days earlier due to the lack of precipitation.
Roughly 73% of Kansas is seeing drought conditions, unchanged from the previous week but up from 48% three months ago, the monitor said.
Iowa is faring better as 40% of the state is suffering from drought conditions, little changed week-to-week but up from only 6.9% three months ago. Indiana, meanwhile, is looking good with only 7.1% seeing drought, but that's up from 5.3% a week earlier and zero percent a quarter ago, the report said.
Iowa and Illinois are the largest producers of corn and soybeans in the U.S.
Also underpinning prices are concerns about whether a fragile deal allowing Ukrainian grain to flow to importers will hold.
Russian President Vladimir Putin in recent days has repeatedly accused Kiev of shipping much-needed grain only to wealthy European countries rather than those with the most need.
Recep Tayyip Erdogan, the president of Turkey and a Putin ally, echoed those comments yesterday.
The agreement allowing Ukrainian agricultural products to ship from the country's ports was partly negotiated by Turkey. Putin said today that he will discuss the deal with Erdogan.
Ukraine Foreign Minister Dmytro Kuleba said in a response this week that two-thirds of the grain sent to foreign countries was directed to Asia, Africa and the Middle East. Prices declined after Ukraine grain was allowed out of its ports, which is important in mitigating global food crises, he said.
"These are real facts and the Russians' fakes about sending Ukrainian grain only to Europe simply do not correspond to reality," Kuleba said.
Soybean futures for November delivery jumped 15 3/4¢ to $14.81 ¾ a bushel overnight on the Chicago Board of Trade. Soymeal added $3.40 to $409.30 a short ton, while soybean oil rose 0.74¢ to $63.97 a pound.
Corn futures for December delivery were up 4 1/4¢ to $6.72 ¾ a bushel.
Wheat gained 9¢ to $8.38 a bushel, while Kansas City futures added 9 1/2¢ to $9.02 1/4 a bushel.**
2. Ethanol Output Rises to Highest in a Month, EIA Says
Ethanol production rose to the highest level in almost a month last week while inventories declined, according to data from the Energy Information Administration.
Output of the biofuel increased to an average of 989,000 barrels a day in the week that ended on Sept. 2, the EIA said in a report.
That's up from 970,000 barrels a week earlier and the highest level since Aug. 5.
In the Midwest, by far the biggest producing region, production surged to an average of 931,000 barrels per day from 911,000 barrels a week earlier, the agency said. That's also the highest since early August.
Rocky Mountain output increased to 14,000 barrels a day, on average, from 13,000 barrels the previous week.
That was the entirety of the gains as West Coast production was unchanged at 9,000 barrels per day for the fourth straight week.
East Coast output declined to 12,000 barrels a day from 13,000 barrels, and Gulf Coast production dropped to an average of 23,000 barrels a day from 25,000 barrels, marking the lowest level since Aug. 12, government data show.
Stockpiles, meanwhile, dropped to 23.138 million barrels in the week through Sept. 2.
That's down from 23.533 million barrels a week earlier and the lowest level since June 24, the EIA said in its report.
3. Weekend Storms Forecast in Parts of Iowa, Illinois and Oklahoma
Thunderstorms are possible tonight into tomorrow in parts of northern and western Iowa, according to the National Weather Service.
Severe weather isn't expected at this time, the NWS said in a report early this morning. Storms likely will continue through the weekend.
"More storms will be possible Saturday through Sunday night," the agency said.
Storms also are likely this weekend in parts o southern Illinois and southwestern Indiana.
"Locally heavy rain and isolated areas of flash flooding will be possible," the NWS said. "Lightning will also be a storm hazard."
Parts of northern and western Oklahoma also will see rain this weekend with precipitation falling Saturday night through early Sunday morning, the agency said.