Chicago | Reuters –– U.S. corn futures fell to a roughly three-week low on Monday while wheat declined to the lowest in one week as grain prices were pressured by position squaring ahead of government crop reports due on Friday.
Analysts expect the U.S. Department of Agriculture to show abundant global grain and soy supplies in monthly and quarterly reports that tend to spur increased volatility in futures.
Improved weather conditions — rains in South America and warmer temperatures in the U.S. Plains — further weighed on prices. Soybean futures eased from Friday’s three-week high at the Chicago Board of Trade.
“Without a weather problem, we are not going to see big bounces” in prices, said Highground Trading broker Scott Capinegro.
CBOT March corn finished four cents lower at $3.47-1/4 per bushel, holding just above its life-of-contract low of $3.46-1/2 last reached on Dec. 19 (all figures US$).
“We’d found support at $3.50-1/4 and, once we breached that, the selling mounted,” said MaxYield Cooperative analyst Karl Setzer.
CBOT March wheat settled three cents lower at $4.27-3/4 and CBOT March soybeans off four cents to $9.66-3/4.
Wheat prices had been supported by fears that frigid weather might damage crops across key U.S. producing regions, which are already struggling with persistent dry weather.
“It is a bit of a concern but it is too early to talk about crop damage in the U.S. and Russia,” said one agricultural commodities analyst in Melbourne. “We will not know the yield potential until March or April.”
Temperatures warmed up and rains arrived in parts of southern Plains wheat areas, alleviating some concerns about damage to plants, before bitter-cold conditions return next week, according to the Commodity Weather Group.
Meanwhile, rains fell in about half of Brazil’s growing regions and about 30 per cent of corn and soy areas in Argentina, the meteorologist said. But the extended forecast for Argentina remains dry and drought was likely to expand, raising risks of reduced yields, a meteorologist and a farmer said.
Large speculators trimmed their net short positions in CBOT corn and wheat futures in the week to Jan. 2 and increased their soybean net short, regulatory data released on Friday showed.
USDA on Monday said about 1.2 million tonnes of U.S. soybeans were inspected for export in the latest week as well as 849,226 tonnes of corn and 234,418 tonnes of wheat, all relatively near analysts’ expectations.
— Michael Hirtzer reports on commodity markets for Reuters from Chicago; additional reporting by Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.