3 Big Things Today, February 12, 2020
1. Corn, Beans Little Changed Overnight on Quiet WASDE Report
Corn and soybean futures were little changed after yesterday’s World Agricultural Supply and Demand Estimates (WASDE) Report that showed only minor changes to balance sheets.
The USDA, in its report, left domestic corn stockpiles unchanged at 1.892 billion bushels, above forecasts for a shift down to 1.864 billion bushels.
Soybean inventories in the U.S., meanwhile, were lowered to 425 million from the January outlook for 475 million bushels, below expectations for a decline to 443 million bushels.
Wheat stocks at the end of the grain’s marketing year are now pegged at 940 million bushels, down from the 965 million projection in January, the USDA said, and well below analyst forecasts for 965 million.
The report was somewhat underwhelming, analysts said, and the markets are reflecting that this morning.
Investors also are keeping an eye on the spread of the coronavirus, which has now claimed more than 1,100 lives and infected more than 45,000 people, almost all of them in China. The UK now has eight confirmed cases and the U.S. still has 12.
Corn futures for March delivery fell ½¢ to $3.79¼ a bushel in overnight trading on the Chicago Board of Trade.
Soybean futures for March delivery lost ¼¢ to $8.84½ a bushel. Soy meal futures fell 50¢ to $290.30 a short ton, and soy oil rose 0.14¢ to 30.86¢ a pound.
Wheat futures for March delivery gained ¼¢ to $5.42¼ a bushel, while Kansas City futures lost 2½¢ to $4.65¾ a bushel.
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2. WASDE Report Shows Brazilian Soybean Production Increasing, Chinese Buying Rising
Several interesting items stood out – not that they moved the markets – from the WASDE Report, none more than the global outlook for soybeans.
Production was raised slightly to 339.4 million metric tons from 337.7 million in January, and stockpiles were raised accordingly, according to the government.
Brazil is now expected to produce 125 million metric tons of soybeans, keeping it as the world’s biggest grower, up from last month’s outlook for 123 million, the USDA said. That’s significant because production was unchanged, other than a small shift down in Paraguay, for the rest of the countries listed in the WASDE Report.
The largest importer, China, is now expected to import 88 million metric tons, up by 3 million tons from the January projection.
The increased purchases by China will bring global crush up to 351.1 million metric tons from the previous outlook for 350.1 million tons.
That was also the only month-to-month alteration on the import side, indicating global demand is steady.
So what’s that mean for ending stockpiles?
World inventories at the end of the 2019-2020 marketing year are now pegged at 98.9 million metric tons, up from the prior outlook for 96.7 million tons. The good news is, that’s down from the 111.2 million tons that were in storage at the end of the 2018-2019 marketing year, according to the WASDE Report.
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3. Blizzard Hitting Parts of Northern Midwest, Winter Weather Expected From Texas to Maine
Weather maps are extremely active this morning, as a blizzard warning is in effect for parts of central and southern Minnesota and a winter weather advisory has been issued from the Texan panhandled all the way to New England.
The blizzard warning, which also encompasses northeastern South Dakota, southeastern North Dakota, extends until 3 p.m. local time today, according to the National Weather Service.
More snow is expected along with winds gusting as high as 50 mph. A wind-chill warning also is in effect in the region as wind chills will dive to -45˚F., the NWS said in a report this morning.
“Widespread blowing snow will significantly reduce visibility,” the NWS said. “The dangerously cold wind chills … could cause frostbite on exposed skin in as little as 10 minutes.”
In Illinois and Indiana, meanwhile, as much as 5 inches of snow are expected starting later this afternoon. Roads are expected to be slippery, and blowing snow likely will reduce visibility, the agency said.