Soybeans Slide as Rainfall Hits the Midwest
June 11 2021 - 3:39PM
Dow Jones News
By Kirk Maltais
--Soybeans for July delivery fell 2.3% to $15.08 1/2 a bushel on
the Chicago Board of Trade Thursday as traders sold following a
fresh wave of rainfall in Midwestern growing areas.
--Corn for July delivery fell 2.1% to $6.84 1/2 a bushel.
--Wheat for July delivery fell 0.4% to $6.80 3/4 a bushel.
HIGHLIGHTS
Rain Rebound: A new round of overnight Midwest rainfall was the
chief source of pressure for grain futures on the CBOT today.
"Futures are broadly weaker on a cold front that passed across the
Dakotas producing needed rainfall," said AgResource. Monday's crop
progress report should provide further indication on whether or not
these rains helped bolster crop health.
Soy It Ain't So!: Soybean futures led row crops lower for most
of the day Friday with weakness especially seen in soyoil futures.
"Soybean oil is down sharply after Reuters put out a story that the
White House is looking into providing relief to oil refiners
impacted by high cost RIN prices amid biofuel blending mandates,"
said Terry Reilly of Futures International. For soyoil, the 4.9%
decline in most-active futures took the contract down from an
all-time high set in the past week - with shortness of vegetable
oil supplies worldwide and interest from the renewable fuels
markets being the main drivers for the runup.
Dollar Muscle: An additional factor weighing on grains was an
uptick in the U.S. dollar, according to Arlan Suderman of StoneX.
The WSJ Dollar Index was up 0.6% today, a sharp jump after a
generally steady week for the dollar amid higher Treasury yields
and inflation concerns. Mr. Suderman also pointed to those midwest
rains and that report of possible Biden Administration actions that
could cut biofuel demand, for weakness in grains today.
INSIGHTS
Fresh Focus: Grain traders, having absorbed the impact of
Thursday's WASDE report, are now turning their attention toward the
USDA's end of month acreage report -- which will show the amount of
row crops U.S. farmers planted this spring. "The big report is on
the 30th, that's where they will change acreage," said John Payne
of Daniels Trading. Traders believe the report will likely show
higher planted acreage than initially forecast. The USDA currently
predicts planted corn acreage at 91.1 million acres, soybeans at
87.6 million acres, and wheat at 46.4 million acres.
Flagging Feed: Prices for dried distillers' grains - a byproduct
of ethanol production commonly used for animal feed - have fallen
in the past week to an average of $206 per ton, which is down $3
per ton from the previous week, according to data from DTN.
"Increased plant production is adding more supply and buyers have
pulled away from the spot market," said DTN's Mary Kennedy. On
Wednesday, the EIA reported that daily ethanol production had risen
to 1.07 million barrels per day, which is the highest rate of
production since February of last year.
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
June 11, 2021 15:38 ET (19:38 GMT)
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