3 Big Things Today, December 5, 2024

1. Wheat Futures Higher in Overnight Trading

Wheat futures were higher in overnight trading on reports that a sizable percentage of Russia’s crops are in poor condition. 

About 37% of Russian grain — mostly wheat — is in poor condition, the highest in at least a decade, said Andrey Sisov, the managing director of SovEcon and author of The Sizov Report. 

Last year at this time only 4% was in poor condition, he said. 

Also boosting prices is adverse weather in Australia, the world’s fourth-largest exporter of wheat, which has led to quality issues. 

Excessive rain has fallen in major growing areas, leading to quality downgrades for the country’s bumper crop, according to analysts and media reports. 

Still, Australian production in the 2024/2025 marketing year is forecast by the U.S. Department of Agriculture at 32 million metric tons, up from 26 million tons the previous season. 

Exports from Australia are pegged at 25 million metric tons this year versus 20 million tons in the 2023/2024 marketing year, USDA data show. 

Wheat futures for March delivery rose 4¼¢ to $5.52½ a bushel overnight on the Chicago Board of Trade, while Kansas City futures were up 4½¢ to $5.47 a bushel. 

Corn futures for March delivery fell ¼¢ to $4.29¾ a bushel. 

Soybean futures for January delivery gained 1¾¢ to $9.85½ a bushel. Soymeal added a dime to $292 a short ton and soybean oil was up 0.08¢ to 41.5¢ a pound. 

2. Ethanol Production Falls from Record High

Ethanol output fell from a record high while inventories increased in the seven days that ended on Nov. 29, according to data from the Energy Information Administration. 

Production declined to an average of 1.073 million barrels a day last week, the agency said. That’s down from a record 1.119 million the previous week and the lowest level since Oct. 11. 

In the Midwest, output averaged 1.014 million barrels a day, down from 1.048 million the week prior and the lowest production since Oct. 18. 

Gulf Coast production plunged to an average of 22,000 barrels a day from 34,000 barrels the previous week, EIA said. 

East Coast output was steady at 12,000 barrels a day for a third straight week, while Rocky Mountain production was unchanged at 15,000 barrels a day for the fifth consecutive week. 

West Coast output was the only gainer this week, rising to an average of 10,000 barrels a day from 9,000 barrels a week earlier, the agency said. 

Ethanol inventories in the week through Nov. 29 totaled 23.003 million barrels. That’s up from 22.869 million the previous week and the highest level since the seven days that ended on Sept. 27, EIA said in its report. 

3. Heavy Snow Expected in Western Michigan

Winter storm warnings have been issued for eastern Michigan as snow and intense winds curb visibility, according to data from the National Weather Service.

Heavy snow is expected to continue throughout the day well into tonight, the agency said. As much as 8 inches of snow are forecast for the area. 

Winds will gust up to 45 mph. 

“Visibilities may drop below a quarter mile due to falling and blowing snow,” NWS said. “The strong winds and weight of snow on tree limbs may down power lines and could cause sporadic power outages.”

In central Indiana, meanwhile, winds will be sustained from 20 to 30 mph with gusts of up to 55 mph expected, the agency said. 

Wind chills were forecast to plummet to as low as minus-5° Fahrenheit overnight.