Chicago | Reuters –– U.S. wheat futures fell one per cent on Monday, their fourth straight day of declines, due to a U.S. government forecast for ample global supplies and crop-boosting rains in the key production areas, traders said.
Corn and soybeans also eased, with corn hitting a one-week low, as the pace of planting picked up across the U.S. Midwest.
“I think we are all expecting a pretty good jump on the planting progress coming out this afternoon,” said Jason Britt, president of Central States Commodities. “The markets are suffering a little bit from that.”
Wheat futures, facing additional pressure from a round of technical selling, hit their lowest since May 1. Wheat has fallen 3.3 per cent during its current losing streak.
Chicago Board of Trade May soft red winter wheat for July delivery settled down 7-1/2 cents at $7.15 a bushel (all figures US$).
On Friday, the U.S. Agriculture Department pegged global wheat production for 2014/15 at 697 million tonnes and forecast that world stocks would rise by almost one million tonnes to 187.4 million tonnes by the end of the crop year.
“We are seeing big losses in the wheat market in response to the USDA report,” said Luke Mathews, commodities strategist at Commonwealth Bank of Australia. “The key thing is the USDA is forecasting comfortable stocks for 2014-15 season and if that comes true, it implies downward pressure on prices.”
Parts of Kansas, the top U.S. wheat state, got beneficial rains in the last day, with some stations in central Kansas reporting more than five cm. Western portions of Kansas, Oklahoma and Texas remained dry and will not see much moisture this week, said Don Keeney, agricultural meteorologist at MDA Weather Services.
K.C. hard red winter wheat futures, which track the crop grown in the U.S. Plains, were 4-1/4 cents lower at $8.24-1/2 a bushel.
CBOT July corn fell eight cents to $4.99-1/2 a bushel while CBOT July soybeans dropped 21-3/4 cents to $14.65-1/4 a bushel. July soybeans settled below their 30-day moving average, a bearish sign.
A USDA report on Monday afternoon was expected to show that U.S. farmers picked up the pace of planting in the past week due to improving field conditions for seeding.
Analysts were expecting the government’s weekly crop progress report to show that corn planting was 55 per cent complete as of May 11, up from 28 per cent a week ago. Soybean planting was forecast to be 17 per cent finished.
— Mark Weinraub is a Reuters correspondent covering agricultural commodity markets from Chicago. Additional reporting for Reuters by Julie Ingwersen in Chicago and Naveen Thukral in Singapore.