1. Corn Higher in Overnight Trading as Drought Spreads

Corn futures were higher in overnight trading as drought spreads in parts of the Midwest.

The U.S. Drought Monitor in a report yesterday said drought conditions in Iowa and Illinois, the biggest producers of corn and soybeans, expanded in the week through Sept. 1.

Some 83% of Iowa is suffering from some level of drought, up from 61% in the previous week, the monitor said.

Fifteen percent of the state – a large chunk in west-central counties – is under an extreme drought, which indicates “major crop and pasture losses” are imminent and water shortages are widespread. That’s up from 6.5% last week.

About 22% is under a severe drought, which indicates likely crop losses and common water shortages, the monitor said.

Conditions aren’t so dire in Illinois, though 26% of the state is seeing some sort of drought, up from only 4.3% a week earlier.

Some 62% of the corn crop was good or excellent at the start of this week, down from 64% the previous week, the U.S. Department of Agriculture said. Twelve percent of the crop was mature.

Sixty-six percent of soybeans earned top ratings, down from 69% seven days earlier, the USDA said. Eight percent of the crop was dropping leaves.

Corn futures for December delivery rose 4 1/4¢ to $3.58 a bushel overnight on the Chicago Board of Trade.

Soybean futures for November delivery added 1 3/4¢ to $9.67 ¾ a bushel. Soymeal gained $1.10 to $313.90 a short ton and soy oil rose 0.08¢ to 33.37¢ a pound.

Wheat futures for September delivery gained ¼¢ to $5.53 ½ a bushel, while Kansas City futures rose 1 1/2¢ to $4.77 ¼ a bushel.

2. Weekly Export Sales of Corn Jump While Soybean Sales Decline

Export sales of new-crop corn jumped in the seven days that ended on Aug. 27 while soybean sales declined, according to the USDA.

Corn sales for delivery in the marketing year that started on Sept. 1 were reported at 2.39 million metric tons, the agency said in a report. That’s up from 1.18 million tons the previous week.

China was the big buyer at 1.16 million metric tons, followed by an unnamed country at 569,000 tons, the government said. Japan bought 343,600 tons, Guatemala was in for 151,800 tons and Costa Rica purchased 47,900 tons.

Old-crop sales of corn came in at 95,800 metric tons just before the end of the 2019-2020 marketing year, down 65% on a weekly basis and 53% from the prior four-week average. China bought 72,100 tons, Mexico took 44,100 tons, Colombia purchased 27,000 tons and Japan was in for 22,100 tons.

Soybean sales, meanwhile, declined to 1.76 million metric tons from 1.87 million tons a week earlier, the USDA said.

China bought 1.01 million metric tons from U.S. supplies, an unknown buyer took 526,000 tons, Vietnam was in for 63,900 tons, Saudi Arabia purchased 55,000 tons and Taiwan was in for 30,000 tons.

For delivery in the 2019-2020 year, soybean sales totaled 88,1000 metric tons, up 75% from the previous week but down 57% from the prior four-week average.

China purchased 83,300 tons, the Netherlands took 69,600 tons, Germany was in for 56,800 tons, Bangladesh bought 55,000 tons and Japan took 22,800 tons.

Wheat sales for offshore delivery in the grain’s marketing year that started on June 1 were reported at 585,400 metric tons, down 23% week-to-week but up 4% from the average, the agency said.

China was again the big buyer at 250,800 tons, the Philippines purchased 116,400 tons, Japan was in for 59,900 tons, Yemen bought 57,000 tons and Taiwan took 50,900 tons, the USDA said.

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3. Isolated Storms Forecast in Parts of Kansas, Oklahoma; Weekend Rain Expected in Iowa

Isolated thunderstorms are expected in parts of southeastern Kansas, eastern Oklahoma and northwestern Arkansas this morning, though no sever weather is expected, according to the National Weather Service.

“Aside from an isolated storm possible this morning across northeast Oklahoma and northwest Arkansas, widely scattered storms are expected to develop across west central Arkansas and far east central Oklahoma this afternoon,” the NWS said in a report early this morning. “Weak flow aloft suggests storms will likely be unorganized and thus severe weather is not expected.”

Over the Labor Day weekend, some precipitation is expected in parts of northern Iowa and southern Minnesota, according to Commodity Weather Group.

After that more rain is expected late next week in parts of Nebraska, Iowa and Illinois, but the precipitation will be “very late for notable corn (or) soybean benefit,” the forecaster said.