Wheat Climbs on Indications of Tighter Supply -- Daily Grain Highlights
September 24 2021 - 03:58PM
Dow Jones News
By Kirk Maltais
--Wheat for December delivery rose 0.8% to $7.23 3/4 a bushel on
the Chicago Board of Trade Friday amid indications of tighter
supplies globally.
--Soybeans for November delivery rose 0.1% to $12.85 a
bushel.
--Corn for December delivery fell 0.5% to $5.26 3/4 a
bushel.
HIGHLIGHTS
Streak of Success: Wheat futures climbed again in trading today,
the third consecutive day that wheat has risen. The outlook for
tighter supplies globally continues to be a driving force for
futures. "Wheat prices erased early losses to drift higher amid
tightening global supplies of milling wheat, amid fears that USDA
might further tighten the spring wheat supply when it posts its
Small Grains Summary Report on Thursday," said Arlan Suderman of
StoneX.
Policy Watch: Corn futures fell today amid concerns that the
Biden Administration will make big cuts to existing biofuel
blending mandates for oil refineries, which is seen as hurting the
demand for U.S. ethanol, a major consumer of domestic corn. "Corn
prices are under pressure on concerns the Biden Administration will
slash biofuel requirements for U.S. refiners ... ethanol accounts
for around one third of corn demand," said Robert Yawger of Mizuho
Securities USA. In a story published Wednesday by Reuters, the EPA
is seen as reducing blending mandates by roughly 2-3 billion
gallons.
INSIGHTS
Story of Selling: Today's commitment of traders report from the
CFTC, which will be released after the market closes today, is
expected to show selling by the large funds of long grains
positions, said Charlie Sernatinger of ED&F Man Capital. Mr.
Sernatinger projects that managed money funds will have sold 4,000
lots of soybeans, 9,000 lots of soyoil, 4,000 lots of corn, and
6,000 lots of wheat. These traders don't seem to be worried much
about next week's quarterly stocks report from the USDA, Mr.
Sernatinger adds. "The trade is largely expecting a snoozer on corn
and bean stocks, but a friendly tone to the wheat, which includes
final spring wheat production," he says. "It has been a long time
since we have had a demonstrably bearish report from the USDA."
Hanging on the Sidelines: Grains traders today were largely
tentative with CBOT futures, with trading volumes staying light
ahead of what's expected to be a busy weekend for harvesting. One
factor at play is farmers deciding what to do with the crop they
harvest, said AgResource. "Some cash corn is being sold in the
Plains/Missouri, but otherwise, producers are storing or filling
contracts which has forward cash bids firming," says the firm --
also highlighting that ethanol plants in the Midwest are starting
to increase their bids in order to incentivize more farmers to sell
new crop.
AHEAD:
--The USDA will release its weekly export inspections report at
11 a.m. ET Monday.
--The USDA will release its weekly crop progress report at 4
p.m. ET Monday.
--The EIA will release its weekly ethanol production and stocks
report at 10:30 a.m. ET Wednesday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
September 24, 2021 15:43 ET (19:43 GMT)
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