U.S. corn futures sagged for the third time in four days on Wednesday, weighed down by the ongoing harvest of what is expected to be a record crop in the United States, traders said.
The weakness in corn, which was hovering near a three-year low, weighed on the wheat market.
“These yield numbers continue to run good,” said Jason Britt, president of Central States Commodities. “It is kind of a foot on the market’s neck for the time being.”
Harvest progress was expected to slow across a broad swath of the U.S. Midwest during the next few days due to rain, but a forecaster said drier weather by Friday will allow farmers to quickly resume their combining.
Soybean futures edged higher, supported by bargain buying after prices fell to a two-week low on Tuesday. Expectations for big soybean exports allowed soy prices to buck the bearish tone hanging over the grains market, Central States’ Britt said.
“Export demand continues to be swift, and the recent break in prices is bringing more buyers to the table,” Sterling Smith, a futures specialist for Citi, said in a note to clients.
Traders said the market was on edge, partly due to a dearth of official data following a recent government shutdown that has created uncertainty among operators.
The U.S. Department of Agriculture is due to publish three weeks’ worth of export sales on Thursday to bring its export reporting up to date. On Nov. 8 it will issue a closely watched crop report that it cancelled earlier this month.
Chicago Board of Trade corn for December delivery settled down 1-3/4 cents at $4.30-1/4 a bushel, and CBOT December wheat dropped 6-1/4 cents to $6.75 a bushel. CBOT November soybeans were 8-1/2 cents higher at $12.87-1/2 a bushel.
Wheat futures faced additional pressure from India’s decision to slash the minimum price for its supplies on the export market.
Trading was light for much of the day as investors were reluctant to stake out new positions ahead of the U.S. Federal Reserve’s policy statement. The statement, which came out 15 minutes before the closing bell, said the Fed will extend its support for a slowing U.S. economy and will continue to buy $85 billion in bonds per month for the time being.
Demand for wheat, which was still within striking distance of a 4-1/2-month high reached last week, remained healthy although there were concerns that U.S. exporters will face increased competition.
“Yes, it is raining in Argentina, but I don’t think it will be sufficient to improve production so I think you will see some increased demand for U.S. wheat,” said Vanessa Tan, investment analyst at Phillip Futures in Singapore.
India has cut the floor price for exports of wheat from government warehouses by 13 per cent to $260 a tonne, a government source said on Wednesday, in a move to boost stalled shipments from the world’s second-biggest producer of the grain.