Chicago | Reuters — U.S. soybean and corn futures fell by over one per cent on Monday on expectations of large harvests that should more than meet demand, adding to hefty inventories, traders said.
Wheat futures also fell, with the spot Chicago Board of Trade contract nearing a two-week low, as traders continued to digest a larger-than-expected estimate of the U.S. 2017 spring wheat harvest.
Chicago Board of Trade November soybeans settled down 11 cents at $9.57-1/4 per bushel and December corn finished down 3-3/4 cents at $3.51-1/2 per bushel (all figures US$).
“We are hearing more and more yield reports that are above expectations … This is giving more credibility to the USDA yield estimates on both corn and soybeans,” Karl Setzer, market analyst for the Iowa-based MaxYield Cooperative, wrote in a note to clients.
Futures drew underlying support from the USDA’s confirmation that private exporters sold 597,464 tonnes of U.S. corn to Mexico and 132,000 tonnes of U.S. soybeans to China.
However, export sales commitments of both commodities are running behind year-ago levels.
“The attitude is that supply is overshadowing demand,” said Tom Fritz, a partner at EFG Group in Chicago.
After the CBOT close, brokerage INTL FCStone raised its estimate of the U.S. 2017 corn yield to 169.2 bushels per acre, from 166.9, in its previous monthly report released Aug. 31. The firm also raised its forecast of the U.S. 2017 soybean yield to 49.9 bu./ac., from 49.8 bu./ac. previously.
USDA said the U.S. soybean harvest was 22 per cent complete by Sunday, behind an average of trade estimates for 25 per cent and the five-year average of 26 per cent.
The corn harvest was only 17 percent complete, lagging the five-year average of 26 per cent.
CBOT December wheat ended down 3-1/2 cents at $4.44-3/4 a bushel after dipping to $4.39-1/2, its lowest since Sept. 19.
Spring wheat futures on the Minneapolis Grain Exchange fell even harder. The spot contract ended down 12-1/4 cents at $6.11-1/2 after sliding to $6.06, its lowest since mid-June, at the start of a summer drought that briefly lifted the market above $8 in July.
USDA on Friday reported U.S. 2017 production of spring wheat other than durum at 416 million bushels, up from its previous estimate of 402 million bushels and well above analysts’ estimates.
— Julie Ingwersen is a commodities correspondent for Reuters in Chicago; additional reporting by Nigel Hunt in London and Naveen Thukral in Singapore.