U.S. corn eases on forecasts for dry harvest weather

U.S. corn futures fell on Wednesday for the first time in three sessions as forecasts for mostly dry harvest weather over the next week weighed on the market, though declines were limited by good export demand.

Wheat drifted lower for a second day, pressured by sinking corn and improved crop weather in key production areas.

Soybeans clawed back the prior day’s modest losses amid support from the rising soyoil market and extended gains near midday on technical buying as the actively traded November contract rose above its 200-day moving average.

Trading volumes were modest, and prices held within a narrow range as the partial U.S. government shutdown, now in its 16th day, deprived the market of key U.S. Department of Agriculture data. USDA said it would decide by the end of this week whether it would cancel its delayed Oct. 11 report.

Meanwhile, mostly clear harvest weather expected over the next two weeks should allow many U.S. Midwest farmers to finish gathering a bumper soybean crop and probably a record-large corn crop.

“The market is just drifting like a ship without a compass,” said Citigroup futures specialist Sterling Smith. “With the lack of not just the big USDA reports but the daily data flows, the opaqueness gets thicker with each passing day, and everyone’s waiting to see what we get out of the government today.”

Senate leaders announced that they reached a bipartisan deal on Wednesday to raise the country’s debt ceiling and end the shutdown, expected to be approved by the House of Representatives later in the day.

Chicago Board of Trade December corn futures fell 3/4 cent, or 0.2 per cent, to $4.42-3/4 per bushel and CBOT December wheat shed 4-1/4 cents, or 0.6 per cent, to $6.81-1/2 a bushel (all figures US$).

CBOT November soybeans rose 9-1/2 cents, or 0.8 per cent, to $12.76-1/2 a bushel. Technical buying above the 200-day moving average of $12.73-1/4 accelerated gains at midday.

Commodity funds bought an estimated net 6,000 soybean contracts on the day and sold a net 3,000 contracts each of corn and wheat, trade sources said.

The lowest U.S. corn prices in three years reignited demand from importers such as China, which has been in the market in recent weeks.

China, the world’s second-largest corn consumer, has bought as much as 300,000 tonnes of the grain from the U.S. this week, trade sources said.

The wheat market remained weighed down by talk of India’s reducing export prices to boost sales and improved planting weather in Russia, Ukraine and the U.S.

“The winter wheat regions will make good planting progress over the next two weeks due to limited rains, and temperatures should not be cold enough to hamper germination,” said Commodity Weather Group meteorologist Joel Widenor.

— Karl Plume reports for Reuters from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore, Veronica Brown in London and Sam Nelson in Chicago.

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