Dollar Feels Pressure after FOMC Statement

Grains Traded Higher in the Overnight Session

October 2, 2020

In the overnight session the grains traded higher with uncertainty still surrounding the impact of the hot and dry weather. December corn up 3 1/4, November Soybeans up 8 and Chicago Wheat up 5.

The EIA ethanol numbers released on Wednesday showed a drop in week over week production by 14 thousand barrels per day to 1.012 million BPD. Weekly ethanol stocks also fell by 608,000 barrels to 21.529 million BPD. To meet the UDSA’s corn used for ethanol projections we will need to see ethanol production pace pick back up and run 3-5% above last year’s levels for the remainder of the marketing year.

The dollar also felt pressure yesterday after the FOMC statement suggested that both overall and core inflation had declined and that the fed will start unwinding the balance sheet “relatively soon”. The language seemed to give traders the impression that there is no increased risk for a rate hike between now and December which will put pressure on the USD.

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Day 2 - Wheat Crop Tour

Spring wheat crops in central northwestern North Dakota were showing the effects of hot and dry conditions and yield prospects were down sharply from a year ago, scouts on the annual crop tour said Wednesday.

The early-planted stuff looks the toughest, said Dave Green, executive vice president of the Wheat Quality Council, which runs the tour. Prospects were slightly better for later-planted wheat and crops in northern areas could still benefit from moisture with harvest still a few weeks away.

Scouts in west-central ND scouted five spring wheat fields and calculated an average yield of 21.3 bushels per acre. A year ago, scouts on the same route calculated average yields of 61.8 and 52.7 bpa.

Scouts on another route in central ND scouted six spring wheat fields and calculated an average yield of 35.8 bpa; last year the average yield calculation was 52.1 to 41.5 bpa. Northwest ND spring wheat fields (three) were scouted and calculated an average yield of 27 bpa; the average durum yield at 45.4 and 52.7 bpa.

Export sales were weaker with new crop wheat down 26 percent, old crop corn down 80 percent and old crop soybeans down 26 percent week over week. Old crop corn sales notched a marketing year low for this week, recording only 92,000 metric tons.

Weekly Export Sales-