Chicago | Reuters — U.S. corn futures rose 2.4 per cent on Wednesday as traders unwound bearish bets following the market’s decline to its lowest since September 2009 on Tuesday, traders said.
“Corn got down to the lowest prices yesterday we have seen in many years, and we have a short-covering bounce,” said Greg Grow, director of agribusiness at Archer Financial Services in Chicago.
Soybean futures firmed, with the market receiving support from news of fresh purchases of U.S. soybeans by China, the top importer of the oilseed.
But wheat fell as traders squared positions after recent strong gains.
Chicago Board of Trade July corn futures settled up 7-1/2 cents at $3.24-3/4 a bushel (all figures US$).
Analysts said the move did nothing to change the underlying fundamentals that have cast a bearish tone over corn due to expectations of lower demand for ethanol.
“Sustaining a rally would necessitate a flip in the fundamentals — from one of burdensome surplus to one of supply concerns,” said Arlan Suderman, chief commodities economist at INTL FCStone.
The Energy Information Administration said that U.S. ethanol output fell 7,000 barrels per day to an all-time low of 563,000 b.p.d. in the week ended April 17.
CBOT July soft red winter wheat was down 2-1/2 cents at $5.43-3/4 a bushel.
Wheat had rallied more than two per cent earlier in the week after USDA said the condition of the national crop was below market expectations, stoking fears of tight supplies.
Chicago Board of Trade July soybean futures were 1-3/4 cents higher at $8.42-1/2 a bushel.
The contract was trading off its highs after hitting technical resistance at it neared its 10-day moving average.
Chinese importers signed deals to buy at least three bulk shipments of U.S. soybeans this week after prices sank to an 11-month low on Tuesday as part of a broad-based commodities sell-off due to the coronavirus outbreak, according to government and private sources.
The U.S. Department of Agriculture said on Wednesday morning that private exporters reported the sale of 198,000 tonnes of soybeans, or about three bulk cargoes, to China in the 2019-20 marketing year.
— Mark Weinraub is a Reuters commodities correspondent in Chicago; additional reporting by Colin Packham in Sydney and Sybille de La Hamaide in Paris.