Chicago | Reuters — U.S. wheat futures fell three per cent to a five-week low on Monday as weekend rains in the U.S. Plains, and forecasts for more next weekend, eased worries about yield prospects, traders said.
Corn followed wheat down, but soybeans rose to an eight-month high on technically driven trade.
At the Chicago Board of Trade, May wheat settled down 13 cents at $4.47-1/4 a bushel after hitting $4.46, its lowest since March 2. CBOT May corn ended down 5-1/2 cents at $3.56-3/4 a bushel.
The May soybean contract settled up 11-1/2 cents at $9.28-3/4 a bushel after reaching $9.29-1/2, the highest for a most-active contract since mid-August.
Wheat was the biggest mover by percentage, pressured as showers moved across dry areas of the Plains hard red winter (HRW) wheat belt. K.C. HRW wheat futures fell even more than Chicago wheat, with most months setting contract lows.
“Attitudes are that (the rain) is going to keep winter wheat conditions pretty solid,” said Tom Fritz, a partner with EFG Group in Chicago.
“If wheat conditions can sustain current ratings through the crop development, you’ve got an excellent chance of seeing a bigger winter wheat crop than you did last year, despite the lower acres,” Fritz said.
Analysts surveyed by Reuters expected the U.S. Department of Agriculture in its weekly crop progress report later on Monday to leave U.S. winter wheat condition ratings unchanged at 59 per cent good to excellent.
The CBOT wheat market is already under pressure from poor export demand amid competition from cheaper suppliers in Europe and the Black Sea region.
CBOT corn fell 1.5 per cent, the most since March 31, pressed by wheat and forecasts for a warmup in the U.S. Midwest that should help farmers start planting. Analysts expected the USDA later on Monday to show U.S. corn planting as two per cent complete.
Soybean futures climbed to multi-month highs, led by soymeal as traders exiting long soyoil/short soymeal spread positions.
Some analysts also cited strength in Brazil’s currency, the real, which erodes the competitive advantage of Brazilian soy on the world export market, and expectations that USDA in a monthly report this week will lower its forecast of U.S. 2015-16 soybean ending stocks.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Theopolis Waters in Chicago, Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.