Wheat Perks Up on Chinese Interest, Softer Dollar
October 17 2019 - 4:06PM
Dow Jones News
--Wheat for December delivery rose 2.4% to $5.25 1/2 a bushel on
the Chicago Board of Trade Thursday, with traders optimistic that
with increased Chinese soybean purchases higher wheat purchases
will come.
--Corn for December delivery rose 0.8% to $3.94 3/4 a
bushel.
--Soybeans for November delivery rose 0.4% to $9.31 1/2 a
bushel.
HIGHLIGHTS
Gauging China's Intent: China intends to increase its purchases
of U.S. agricultural goods, a story from the South China Morning
Post said Thursday, quoting a spokesman from China's Ministry of
Commerce. However, the agreement is tentative and unfinished, as
Chinese officials want the U.S. to cancel more of the tariffs
imposed during the trade war. Soybeans are expected to see more
Chinese purchases, but wheat exports are also expected to see a
boost.
Dollar Weakness: The dollar traded lower again Thursday,
providing support for agricultural futures trading. Wheat got the
most benefit out of the weaker dollar due to the tough competition
from Russian and European products, leading December wheat higher
for grains. It's the third trading session in a row that the dollar
has declined, and the fifth out of the last six. Wheat futures,
meanwhile, are up 13.5% since the start of September--the strongest
rally among grains during that time frame.
INSIGHT
Data Do-Over: November's WASDE report will include a resurvey of
harvested acres of corn and soybeans in Minnesota and North Dakota
following a snowstorm that hit last weekend, the USDA said. "The
USDA resurvey is likely to lower harvested acres on the November
report," said Doug Bergman of RCM Alternatives. The Nov. 8 report
may also show bigger cuts to production and yields as a result of
the further delays to the harvest, with some crops damaged by the
chill. Last weekend, areas of the northern plains received anywhere
from a foot to 2.5 feet of snow.
Ethanol Stockpile : U.S. inventories of ethanol appear to be
rebuilding after declining sharply last week--with inventory up
837,000 barrels to 22.061 million barrels, according to the EIA. In
the previous week, stocks had dropped by 1.995 million barrels, the
largest decline ever recorded by the EIA. Meanwhile, daily
production has increased slightly as well this week, totaling
971,000 barrels per day, or 8,000 more than last week. Corn futures
didn't react much to the report, although traders thought stocks
may continue to fall.
Beyond Meat Feeling Heat: Beyond Meat shares are down 4.7% as
investors mull the impact of dining and entertainment chain Dave
& Buster's announcement that its 130 locations will swap out
its Impossible Foods plant-based burgers for rival versions
produced by Lightlife, a smaller subsidiary of Canadian meat giant
Maple Leaf Foods. Beyond and Impossible have been the main players
of the revolutionized veggie burger market, but meat giants like
Maple Leaf, Tyson Foods and JBS have rapidly followed, heightening
competition in the fast-growing sector.
AHEAD:
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. EDT Friday.
--The CFTC will release its weekly commitment of traders data at
3:30 p.m. EDT on Friday.
--The USDA will its weekly grain export inspections data at 11
a.m. EDT Monday.
(END) Dow Jones Newswires
October 17, 2019 15:51 ET (19:51 GMT)
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