1. Increase in grain and soybean futures in overnight trading
Grain and soybean prices surged in trade overnight on concerns over global exports amid continued fighting in Ukraine.
Russia allegedly bombed civilian targets in the Ukrainian capital of kyiv, government officials said, according to media reports. In Odessa, Ukraine, officials said the Russians were using unmanned aerial vehicles in the city.
Ukrainian fighters refuse to cede control of the city of Mariupol.
Russia is the world’s largest wheat exporter, according to data from the US Department of Agriculture.
The USDA lowered its outlook for the country’s exports to 20 million metric tons in a report released earlier this month from a February projection of 24 million tons.
Prior to the Russian attacks, Ukraine was expected to be the third-largest wheat shipper, but is now expected to be the fourth-largest exporter behind Russia, Australia and the United States.
India said it would increase grain shipments to account for the lack of supplies from Russia and Ukraine.
Soybean futures were higher in part due to projections of prolonged drought in the western United States and warmer than normal temperatures across much of the country this spring.
The National Oceanic and Atmospheric Administration said in a report released last week that about 60% of the continental United States — essentially the western half — has a good chance of spring drought.
If realized, it would be the largest drought blanket since 2013, said Jon Gottschalck, chief of the operational forecasting branch at NOAA’s Climate Prediction Center.
Wheat for May delivery jumped 27¢ to $10.90 ¾ a bushel overnight at the Chicago Board of Trade, while Kansas City futures added 26 1/2¢ to $10.97 the bushel.
Soybean futures for delivery rose 20 1/2¢ to $16.88 a bushel. Soybean meal rose $4.40 to $481.40 a short ton and soybean oil futures gained 1.79¢ to 74.08¢ a pound.
Corn futures for May delivery added 12 3/4¢ to $7.54 ½ a bushel.
2. Investors are making bullish bets on corn and beans
Fund managers increased their net long positions, or higher price bets, in corn and beans last week, according to the Commodity Futures Trading Commission.
Investors held a net 361,250 corn futures in the seven days ending March 15, down from 355,824 contracts a week earlier, the CFTC said in a report.
This is the biggest bullish position since the week ending February 1st.
Speculators held a net long position of 161,928 soybean futures contracts, down from 161,670 contracts the previous week, the government said.
In wheat, investors held 43,808 hard red winter futures contracts last week, down from 44,396 contracts the previous week. This is the smallest post of its kind in three weeks.
Fund managers and other large investors held a net long position of 24,967 contracts in soft red winter wheat futures, down from 21,757 contracts the previous week.
It is the largest such position since the seven days that ended March 2, 2021, the CFTC said in its report.
The Commodity Futures Trading Commission’s weekly Commitment of Traders report shows traders’ positions in the futures markets.
The report provides positions held by commercial traders or those who use futures contracts to hedge their physical assets; non-commercial traders or fund managers (also called large speculators); and non-declarable, or small speculators.
A net long position indicates that more traders are betting higher prices, while a net short position means that more futures bets will fall.
3. Winter storms expected in parts of the southern plains
Winter weather is slipping into the Southern Plains this morning and will move east across the Southern Plains today, according to the National Weather Service.
A winter storm warning has been issued in southeastern Colorado and winter weather advisories will go into effect this afternoon across much of Oklahoma and Texas, the NWS said in a report early this afternoon. morning.
In eastern Colorado, heavy snowfall is expected today with accumulations of up to 9 inches, the agency said. Winds will blow up to 55 miles per hour.
In the Oklahoma and Texas panhandles, snow accumulations will reach about 2 inches, but winds will also blow up to 55 miles per hour, the agency said.
“Expect slippery road conditions,” the NWS said. “Strong winds could drop visibility below a mile.”
Further north, in parts of South Dakota, wind advisories and severe wind warnings have been issued.
Sustained winds ranging from 30 to 40 miles per hour with gusts of up to 60 miles per hour are expected, the NWS said. Tree damage is expected and power outages are possible.