Chicago | Reuters—U.S. corn futures retreated on Tuesday on a round of profit-taking after a tighter U.S. supply outlook lifted prices to one-year highs, analysts said.
Soybeans set back from a multi-month top as some forecasts called for light weekend rains in crop areas of Argentina, while wheat futures eked out modest gains.
Chicago Board of Trade most-active corn futures Cv1 settled down 2 cents at $4.74-1/2 per bushel after rising to $4.79-3/4, the highest on a continuous chart of the most-active corn contract Cv1 since December 2023.
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CBOT benchmark soybeans Sv1 ended down 5-1/2 cents at $10.47-1/2 a bushel, pulling back after reaching $10.64, a three-month top. CBOT wheat Wv1 settled up 1-1/4 cents at $5.46-1/4 a bushel.
Corn futures backed down from lofty highs as farmers sold grain, seizing on a rally triggered by bullish government crop reports released on Friday. The U.S. Department of Agriculture cut its estimates of the U.S. 2024 corn and soybean harvests and tightened its forecasts of end-year stockpiles more than analysts had expected.
The cash sales and speculative profit-taking weighed on corn and soybean futures.
“You’ve got a cash market that has seen the pipeline replenished with farmer sales. Farmer selling has been very active (on) Friday, yesterday and early today, but as the Board has set back, it has quieted down,” said Terry Linn, an analyst with Linn & Associates in Chicago.
Furthermore, commodity funds have been building a hefty net long position in CBOT corn futures, leaving the market prone to bouts of long liquidation. Funds held their most bullish position in corn since 2022 ahead of the USDA’s reports but were bearish on soybeans due to plentiful global supplies.
Meanwhile, some forecasts called for modest weekend rains that could bring relief to Argentine crops stressed by a heat wave. Argentina is a major producer of corn and soybeans and the world’s biggest exporter of soymeal and soyoil.
“That is another reason to tap the brakes a bit on the rally,” Linn said.
Wheat futures inched higher as traders awaited fresh direction. A setback in the dollar lent support, making U.S. grains more competitive globally. However, the greenback remains near two-year highs.
