U.S. grain and soy futures closed mostly lower on Wednesday as farmers geared up for what’s expected to be their best stretch of planting this spring.
Forecasts for dry weather in the U.S. Midwest bolstered hopes that growers will be able to push planting back on schedule after damp field conditions caused the slowest start to corn seeding in 29 years.
“The factor having the greatest impact in the market right now is improving weather,” said Nicole Thomas, commodity analyst with McKeany-Flavell. “There is still plenty of time to get the acreage planted and we have not yet reached a point where we are looking at any serious degradation to yield.”
New-crop corn contracts fell the most, dropping 1.5 per cent.
“Even though it is wet this week, I suspect you have people looking forward to better planting weather next week,” said Mike Krueger, president of the Money Farm, a crop advisory service near Fargo, N.D.
Chicago Board of Trade (CBOT) December corn futures closed down 7-1/4 cents at $5.32 a bushel (all figures US$). The most-active July corn contract fell seven cents to $6.33/bu.
The weakness in corn weighed on wheat futures. CBOT July soft red winter wheat dropped three cents to $7.06 a bushel. Kansas City Board of Trade hard red winter wheat futures and MGEX spring wheat closed higher, with KCBT contracts supported by poor crop conditions and MGEX rising on planting delays in the northern U.S. Plains.
Old-crop soybeans, supported by scant cash market supplies, were another bright spot. But prices closed below session highs because of news that Paraguayan and Brazilian soybeans are set to be shipped to the United States.
CBOT soybean futures for July delivery settled up 8-1/2 cents at $13.90-3/4 a bushel.
“It is the tightness in the old crop,” said Anne Frick, oilseeds analyst for Jefferies Bache. “We are running out of supplies. Crushers are probably having some problems sourcing beans. I think that is supporting the market.”
New-crop November soybeans also fell amid the bearish tone hanging over agricultural commodities, closing down 1/4 cent at $12.14-1/4 a bushel.
Better planting weather is expected in the U.S. Midwest over the next week to 10 days, said Andy Karst, meteorologist for World Weather Inc.
Traders also noted positioning ahead of the USDA’s monthly report on global supply and demand, which will be released on Friday.
U.S. corn supplies at the end of the 2013-14 crop year were forecast at a nine-year high due to the biggest plantings since the 1930s, analysts said ahead of the government’s first forecast for new-crop stocks.
— Mark Weinraub covers grain futures markets for Reuters in Chicago. Additional reporting for Reuters by Sam Nelson.