By Kirk Maltais


--Soybeans for July delivery rose 2.3% to $17.29 1/4 a bushel on the Chicago Board of Trade Thursday, in reaction to news stories reporting new favorable biofuel-blending requirements from the EPA, as well as palm oil stress overseas.

--Wheat for July delivery rose 1.6% to $10.58 1/4 a bushel.

--Corn for July delivery fell 0.1% to $7.30 1/4 a bushel.


HIGHLIGHTS


Two Prong Support: Soybean futures, by way of soyoil futures, got help from two sources Thursday. The first: supply concerns for palm oil in Asia--with Dow Jones reporting earlier that the recent cut in production estimates by the Malaysian Palm Oil Council spurred an uptick in palm oil futures overseas. "Hopes for better demand from India keep the market supported," Jack Scoville of Price Futures Group said in a note. The second: news reports stating that the EPA will release new blending mandates for biofuels that will be favorable for biofuel producers, in an effort to mitigate the fallout of the Russia-Ukraine conflict on crude oil prices.

Better Than Expected: Wheat futures rose Thursday in reaction to Egypt's large wheat purchase. The state purchasing agency bought 465,000 metric tons of wheat in an international tender on Wednesday, sourcing the wheat from Russia, Romania and Bulgaria--accepting eight bids in total. "The [Egyptian] wheat purchase indicates that the world's largest wheat importer is pessimistic about the chances of a Ukraine grain export corridor being allowed/established by Russia," said AgResource in a note. Wheat futures fell 8.8% in the previous two days, due to the possibility that Black Sea wheat could restart shipping out of ports there.


INSIGHTS


Hopeful Turn: Daily ethanol production in the U.S. surged this week, while inventories shrank to their lowest levels since the start of the year, according to EIA data. The government said U.S. ethanol daily production rose to a rate of 1.071 million barrels a day for the week ended May 27, up from 1.014 million barrels a day. This week's figure is well up from the predictions of analysts surveyed by Dow Jones, who had forecast a range of 1 million barrels a day to 1.028 million barrels a day. Ethanol stocks dropped considerably for the week--falling to 22.96 million barrels versus 23.71 million barrels reported last week. It's the lowest inventories have been since the first week of the year, and falls well outside the range forecast by analysts.


Tempered Expectations: Export sales of U.S. grains are expected to stay low this week, according to traders surveyed by The Wall Street Journal. Depressed levels of sales reported last week for most grains are expected to continue, particularly for corn. Traders forecast corn sales to land anywhere 225,000 metric tons to 700,000 tons--versus 209,900 tons reported last week. Meanwhile, soybean sales are expected to land between 400,000 tons and 800,000 tons, and wheat sales are expected to be between 75,000 tons and 400,000 tons. Expectations for increased export sales with China easing its Covid-19 lockdowns are supporting futures this week.

Dropping the Ball: The ports of Long Beach and Los Angeles, from which many grain shipments are sent overseas, are among the least efficient ports in the world. In a study released in late May by the World Bank and S&P Global Market Intelligence, out of 370 ports globally--Long Beach and Los Angeles were ranked 369 and 370 in efficiency, respectively. "The large queue of ships on the U.S. West Coast in 2021 stemmed from such factors as pandemic-induced labor issues at the ports, slow chassis turns, lack of container staging space, slow rail service, and containers out of position in the network," the USDA said in its latest weekly Grain Transportation Report.


AHEAD:


--The USDA will release its weekly export sales report at 8:30 a.m. ET Friday.

--The CFTC will release its weekly commitment of traders report at 3:30 p.m. ET Friday.

--The USDA will release its weekly grains export inspections report at 11 a.m. ET Monday.

--The USDA will release its weekly crop progress report at 4 p.m. ET Monday.


Write to Kirk Maltais at kirk.maltais@wsj.com


(END) Dow Jones Newswires

06-02-22 1521ET