Wheat Drops on U.S. Dollar Strength -- Daily Grain Highlights
By Kirk Maltais
--Wheat for December delivery fell 2.2% to $7.06 1/2 a bushel,
on the Chicago Board of Trade Tuesday in reaction to the rising
U.S. Dollar Index.
--Corn for December delivery fell 1.3% to $5.32 1/2 a
--Soybeans for November delivery fell 0.8% to $12.77 a
Pulling the Plug: Wheat futures led grains lower today as a
strengthening U.S. dollar appears to be affecting wheat more than
its corn or soybean counterparts. "It's not surprising that the
longs in wheat would likely be pulling the plug on their positions
with a 10-Month high in the US Dollar Index," said Mike Zuzolo of
Global Commodity Analytics. "Our U.S. wheat price is getting more
expensive at a time when ample competitive stocks can be found."
Indications of additional export taxes on Russian wheat have been a
factor supporting wheat futures recently.
Something's Missing: In its roundup of daily flash export sales,
the USDA confirmed that 150,000 metric tons of corn was sold to
Mexico for delivery in the 2021/22 marketing year. However, no
mention was made of any new sales of corn to China, which is likely
to weigh on CBOT corn futures, especially after signs of thawing in
US-China relations. "There is some optimism in the Ag market that
the recent agreement between the U.S. and China that led to Canada
releasing the CFO of Huawei could lead to more export sales to the
world's largest grain importer," said Robert Yawger of Mizuho
Rapid Reaping: The USDA's crop progress report released late
yesterday showed that harvesting for corn and soybeans is
progressing faster than the pace of recent years. The U.S. corn
harvest is now 18% complete, which is up from the 4-year average of
15%. Meanwhile, the soybean harvest is 16% complete, up from a
4-year average of 13%. "The weather forecast for early October is
not calling for much precipitation, so harvest progress over the
next couple of weeks will be rapid," said Tomm Pfitzenmaier of
Summit Commodity Brokerage.
Turning Higher: Daily production of ethanol in the U.S. is
expected to jump in this week's report from the EIA, according to
analysts surveyed by Dow Jones. They peg production to total as
high as 946,000 barrels per day, which is up from last week's
estimation of 926,000 barrels per day. If production were to turn
that high, it'd be the highest level since mid-August. Meanwhile,
ethanol inventories in the U.S. are generally expected to decline
this week, potentially falling to under the 20 million barrel
--The EIA will release its weekly ethanol production and stocks
report at 10:30 a.m. ET Wednesday.
--The USDA will release its weekly export sales report at 8:30
a.m. ET Thursday.
--The USDA will release its quarterly grains stocks report at
noon ET Thursday.
--The USDA will release its monthly agricultural prices report
at 3 p.m. ET Thursday.
Write to Kirk Maltais at firstname.lastname@example.org
(END) Dow Jones Newswires
September 28, 2021 15:33 ET (19:33 GMT)
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