Chicago | Reuters — U.S. wheat futures shed 1.3 per cent on Tuesday, their third straight day of declines, after a government report showed that crop conditions improved amid better moisture in main growing areas, traders said.
“I do not think there is much going on out there (to help wheat),” said Mike Krueger, president of the Money Farm, a grain market advisory service near Fargo, N.D. “Export sales out of the U.S. are still kind of slow. There is just no excitement at the moment.”
Corn and soybean futures firmed on technical support as investors took advantage of recent declines to contract lows to cover bearish bets they had placed as farmers reaped huge harvests of both crops across the U.S. Midwest.
“Big speculators doubled their bearish bet in ag commodities last week, according to Commitment of Traders data released Monday, and now hold a record net short position across the spectrum of major futures traded in the U.S., including crops and livestock,” Bryce Knorr, senior editor of Farm Futures magazine, said in a research note.
Chicago Board of Trade January soybean futures settled up 4-1/2 cents at $8.64 a bushel (all figures US$). CBOT corn for December delivery was two cents higher at $3.62 a bushel.
The gains in corn were kept in check by the weakness in the wheat market.
Chicago Board of Trade December wheat futures dropped 6-1/2 cents to $4.87-1/2 a bushel. The front-month contract hit its lowest level since Oct. 20 during the session.
The U.S. Department of Agriculture said in its weekly crop progress report released on Monday afternoon that 52 per cent of the winter wheat crop was rated good to excellent, up one percentage point from the prior week.
Improving weather in other large wheat production areas added further pressure, bolstering prospects of a boost to already plentiful global supplies.
Forecasts calling for precipitation in parched wheat belts in Russia and Ukraine, along with mild temperatures that could help plant development before winter, offset concerns about next year’s harvest in the Black Sea region.
Drought in Ukraine already cut winter grain sowings, leading some market players to project a sharp drop in the country’s production and exports next season.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.