Corn Rises as Traders Stay Cautious Following WASDE
Corn for December delivery rose 1.2% to $3.27 1/4 a bushel on the Chicago Board of Trade Wednesday, with grains traders waiting to sell off of bearish WASDE data until more is known about this week's Midwest wind storm. Soybeans for November delivery rose 1.1% to $8.83 a bushel. Wheat for September delivery fell 0.8% to $4.91 1/4 a bushel.
Although the data released by the USDA in Monday's WASDE largely exceeded the expectations of analysts surveyed by The Wall Street Journal, grain futures trading on the CBOT were largely unmoved following the report's release. For corn--which the USDA projected higher yield and production in than analysts had--better assessments of crop damage due to wind storms in the Midwest this week are keeping traders on the sidelines. "A quiet reaction to the numbers with the market apparently wanting to assess the damage across Iowa before dropping to new lows for corn," said Doug Bergman of RCM Alternatives.
US Ethanol Production Turns Lower For Second Week -- Market Talk
1121 ET - Production of fuel ethanol in the US again dropped this week, according to data released by the EIA. Daily production of ethanol totaled 918,000 barrels, down 13,000 barrels per day from last week. Grains traders had expected an uptick, says Terry Reilly of Futures International. "The ethanol data was perceived to be bearish for US corn futures," says Reilly. The uptick of Covid-19 cases in the US may be contributing to gasoline consumption by consumers -- although ethanol inventories fell by 596,000 barrels in the past week, totaling 19.75 million barrels. That's the lowest inventories have been since December 2016. (firstname.lastname@example.org; @kirkmaltais)
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U.S. Corn Supply Grows on Record Crop Yield
The U.S. corn supply -- already projected to near record levels -- is continuing to grow thanks to supportive weather in the Midwest that has improved crop yields.
In its monthly supply-and-demand report released Wednesday, the U.S. Department of Agriculture said it expects 2020 corn production to total 15.3 billion bushels, up 278 million bushels from its previous estimate. The main driver of the uptick is higher yields per crop acre, which the USDA now projects to be at a record 181.8 bushels per acre.
Bayer Backs Seeds for Indoor Farms -- Market Talk
09:32 ET - Startups over the past decade have crowded into the vertical farming space, competing to build the most efficient indoor growing environments for herbs and vegetables, repurposing warehouses and shipping containers as crop factories. Germany's Bayer, the biggest crop-seed supplier to farmers, now aims to be a top seed supplier to these indoor farms too, backing a new company called Unfold that will develop vegetable seed varieties specifically for vertical farming. Bayer and Singapore investment giant Temasek are backing the venture, which will draw upon Bayer's crop-development assets and will be led by John Purcell, Bayer's head of vegetable R&D. (email@example.com; @jacobbunge)
USDA Reports Fifth Consecutive Day of Chinese Buying -- Market Talk
11:00 ET - China is again in the US export market for soybeans, the USDA confirms Wednesday. It's the fifth day in a row that China has purchased US soybean exports, with the USDA saying China bought 258,000 metric tons of US soybeans for delivery in the 2020/21 marketing year. Additionally, 120,000 tons of soybeans were sold to unknown destinations for delivery in 2020/21. Over the course of the past five days, the USDA has confirmed that 1.56M tons of soybeans have been sold to China. However, grains traders have not responded to the wave of buying by piling into CBOT soybean futures--with the most-active contract down 0.4% in that time period. (firstname.lastname@example.org; @kirkmaltais)
Hog Futures Pare Losses -- Market Talk
15:29 ET - Lean hog futures on the CME dropped another 0.4% Wednesday, closing at 51.6 cents per pound. However, this is a pared-down loss from earlier today, when hog futures were down to as low as 50.55 cents per pound. Hog futures may have found a short-term low, says Michael Seery of Seery Futures. "Hog market prices are very cheap as the risk/reward would be in your favor to go long," says Seery. Meanwhile, live cattle futures rose 1.2% to close at $1.09575 per pound. (email@example.com; @kirkmaltais)