Wheat Slides Amid Election Jitters
By Kirk Maltais
--Wheat for December delivery fell 0.7% to $6.15 3/4 a bushel,
on the Chicago Board of Trade Tuesday, dropping for a second
straight day as grains traders were cautious in trading ahead of
next week's U.S. general election.
--Soybeans for January delivery fell 0.6% to $10.76 1/2 a
--Corn for December delivery fell 0.4% to $4.16 a bushel.
Treading With Caution: Grains futures on the CBOT finished lower
Tuesday. Traders took a cautious approach toward commodities ahead
of next weeks' presidential election. "There is an 'air' of
correction in the marketplace," AgResource said. "The risk vs.
reward amid improving South American, U.S. and Black Sea weather
forecasts is not there with a major US election in a week." The
caution has extended to the equities markets The Dow Jones
Industrial Average fell 0.5% in late afternoon trading.
Closing In: The U.S. harvest for corn and soybeans is solidly
ahead of the usual 5-year pace, the USDA said in its crop progress
report released yesterday - pegging the corn harvest at 72%
finished and soybean harvest at 83% done. "These are both at levels
where trade will quickly put the year to rest and focus instead on
what will be done with the new inventory," said Karl Setzer of
AgriVisor. The progression of the harvest put pressure on CBOT
Applying the Brakes: U.S. ethanol production and inventories are
expected to drop again this week, said Terry Reilly of Futures
International. Futures International forecasts ethanol production
to drop 6,000 barrels per day to 907,000 barrels per day, which
would be the lowest they've been since mid-September. Meanwhile,
the firm forecasts ethanol inventories to fall 100,000 barrels to
300,000 barrels -- which could potentially put ethanol inventories
at their lowest levels since December 2016. An inventory drop
combined with higher production would be a hopeful sign for grains
traders looking to see U.S. ethanol rebound in domestic demand.
Staying Elevated: Palm oil prices will likely ease slightly over
the coming months but remain somewhat elevated, said Fitch
Solutions in a note. The firm forecasts that palm oil will average
MYR2,580 a metric ton as it assumes that it will remain above
MYR2,600 for the rest of the year. It says global production will
recover strongly in 2020-2021, economic activity will be stronger
in 2021, along with restaurant sales and fuel use, which will
support palm oil consumption; "The continued recovery in palm oil
imports from India and China and robust biodiesel production in
Indonesia will keep prices supported next year." Palm oil prices
have been a main driver for higher U.S. soybean futures.
--Kellogg Co. will release third-quarter earnings before the
stock market opens on Wednesday.
--The EIA releases its weekly update on ethanol production and
inventories at 10:30 a.m. ET Wednesday.
--The USDA will release its latest weekly export sales numbers
at 8:30 a.m. ET Thursday.
--Archer Daniels Midland will release third-quarter earnings
after the stock market closes on Thursday.
Lucy Craymer contributed to this article.
Write to Kirk Maltais at email@example.com
(END) Dow Jones Newswires
October 27, 2020 15:44 ET (19:44 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.