Soybeans Slightly Higher Overnight

October 11th, 2016

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Category: Oilseeds

Tractor spraying soybean field(Agriculture.com) – SOYBEANS SLIGHTLY HIGHER OVERNIGHT ON CONTINUED DEMAND

Soybean futures rose modestly overnight on expectations that demand will continue to be strong.

Exporters last week sold 2.18 million metric tons of soybeans to overseas buyers, and sales in the first month of the 2016-2017 marketing year that started on Sept. 1 are about 30% ahead of last year’s pace, according to the U.S. Department of Agriculture.

Palm oil, a rival oilseed derivative, prices are up due to a weaker Malaysian ringgit, which makes palm more attractive. Rising palm oil prices tend to buoy the cost of competing oilseeds.

Grains were little changed overnight as investors weigh favorable harvest weather in the Midwest and good planting weather in the southern Plains against calls for a record corn crop.

Soybeans for November delivery rose 2 ¾ cents to $9.57 ¼ a bushel on the Chicago Board of Trade. Soymeal futures for December delivery added $1.40 to $299.50 a short ton and soy oil gained 0.10 cent to 33.92 cents a pound.

Corn futures for December delivery fell a penny to $3.42 ¼ a bushel in Chicago.

Wheat futures for December delivery gained ½ cent to $4.04 ¼ a bushel in Chicago, while Kansas City futures lost ¾ cent to $4.06 ¼ a bushel.

HIGHEST OIL PRICES IN 15 MONTHS MAY BOOST ETHANOL DEMAND

Oil futures rose to their highest level in 15 months yesterday as members of the Organization of the Petroleum Exporting Countries (OPEC) meet to hammer out a deal in which they’d curb crude production, and after Russian President Vladimir Putin said his country also may cut output.

Higher oil prices are a mixed bag for U.S. farmers.

First the bad – rising crude means increased fuel prices across the board, and farm equipment isn’t generally known for being fuel-efficient. Trucks to transport grain to and from the end-user or the elevator will cost more, driving up transportation prices. It also could lead to increased prices for certain agricultural chemicals.

The good news is that higher oil prices, which again translate to higher prices at the pump, tend to mean increased use of ethanol.

Production of ethanol in the week that ended on Sept. 30 fell to the lowest since June, according to the Energy Information Administration. Stockpiles of the biofuel also declined week-over-week. That could change if oil prices remain high.

Still, prices backed off overnight after an International Energy Administration report showed global crude supply rose by 600,000 barrels a day in September as non-OPEC production – including Russian and Kazakh flows – accounted for about 500,000 barrels of that growth.

While supply last month rose, if OPEC members hammer out an agreement and actually curb or freeze production – a scenario about which some analysts are still skeptical – then the price of oil could rise, which would likely boost demand for ethanol.

ISOLATED THUNDERSTORMS EXPECTED IN PARTS OF KANSAS, MISSOURI

Some isolated storms are expected in parts of eastern Kansas and western Missouri today as a storm front slowly moves through.

While severe weather is mostly not expected, some storms in the region could bring small hail, the National Weather Service said in a report early Tuesday.

Parts of Iowa and western Illinois also may get some rain today, though showers are expected to be scattered around the area, according to the NWS.

The Mississippi River is still above flood stage at points in southern Iowa south well into Missouri. The river is over its banks in Canton, Quincy, Hannibal, Saverton, Louisiana, Clarksville, Winfield and Grafton, the NWS said. In Hannibal, the river is at 27.8 feet, well above flood stage of 26 feet.

 

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