Headlines:                                                                  

  • Brazilian Firms Announce Plans for New Corn-Based Ethanol Plants
    Two Brazilian companies plan to build ethanol producing facilities using corn as raw material, they said on Tuesday, aiming to take advantage of ample supplies of the cereal in the country’s center-west region. Brazil’s ethanol industry, the world’s second-largest behind the U.S., is almost entirely based on sugar cane, a raw material usually seen as more efficient than corn. But rising demand for ethanol and successive corn output surpluses could offer opportunities in some regions. Cerradinho Bioenergia SA plans to build a corn-based ethanol plant in Goiás state with the capacity to produce 230 million liters per year, according to a statement released by the state’s press agency.
  • Wheat futures near six-month high, spurred by US crop worries
    Futures in hard red winter wheat soared to their highest in nearly six months, leading a strong session for agricultural commodities, and further punishing hedge funds caught out with record bearish bets on the complex. Kansas City hard red winter wheat futures for March stood up 3.2% at $4.67 ½ a bushel in late deals, 0.75 cents from an intraday peak which was the highest for a spot contract since August 1 last year. It also represented outperformance over Chicago-traded soft red winter wheat, the world benchmark, which for March gained 1.2% to $4.54 ½ a bushel. Minneapolis spring wheat lagged the winter wheat classes, up 0.9% at $6.19 a bushel, with higher prices seen boosting prospects for North American sowings ahead. The gains followed the release overnight of official data showing a marked deterioration in the condition of wheat crops in the central southern Plains, a major hard red winter wheat-growing area, which has seen spreading drought, with little rain relief in sight. “The five-day precipitation outlook offers little chance of moisture for the majority of wheat growing areas in Kansas, Oklahoma, Colorado, or Texas,” said Dr. Mark Welch at Texas A&M University.

 

Summary:

Today’s gains were almost a replica of yesterday’s advances in Corn, Wheat and Beans. Corn found strength from short covering and continued gains in the Wheat market helped to bolster its rise. Private US exporters reported 132,000 metric tons of Corn sales to Spain for the 2107-18 marketing year. The Argentine Ag Ministry stated that the possibility reductions to the Corn area and Corn yield estimates exists even after the adjustment from last week from 8.8 million hectares to 8.7 million hectares. The adjustments were the result of dry weather in the northern growing areas during a key stage of early planted Corn. After a small pause in its advance Beans returned to moving higher again. Worries about dryness in Argentina and delays from wetness in Brazil has been the underpinning strength behind the Soybean advance that started two weeks ago. With crop ratings falling to record low levels, Wheat continues to receive that data it needs to help it along as it has been tracing our cycle projections very closely.