Chicago | Reuters — U.S. corn futures dropped on Friday while soybeans and wheat edged higher in muted trading as investors waited for the U.S. government’s monthly update to harvest projections.
Corn futures remained under pressure from profit-taking after prices jumped to a seven-week high on Tuesday.
The market shrugged off long-awaited news that the Trump administration would boost U.S. biofuels consumption starting next year. The new rules, which still must be finalized, “ensure that more than 15 billion gallons of conventional ethanol be blended into the nation’s fuel supply beginning in 2020,” according to the Environmental Protection Agency.
“In general, it is nothing that is a quick fix of any sort,” said Mark Schultz, chief analyst at Northstar Commodity Investment Co. “The corn market needs demand quickly, not somewhere down the road. We just do not have any demand to speak of.”
CBOT December corn futures ended down four cents at $3.84-3/4 a bushel (all figures US$).
“Corn was under pressure off buy the rumor/sell the fact trading on the EPA ethanol announcement today,” Charlie Sernatinger, global head of grain futures at ED+F Man Capital, said in a note to clients.
CBOT November soybean futures were up 4-1/2 cents at $9.16-1/4 a bushel but remained below the 10-week top hit on Tuesday.
CBOT December wheat was 1-3/4 cents higher at $4.90-1/2 a bushel.
Corn rallied early in the week after the U.S. Department of Agriculture’s (USDA) lower than anticipated estimate for U.S. inventories, which could herald tighter supplies if the Midwest harvest brings mixed yields.
“Next Thursday’s world agricultural supply and demand estimates (WASDE) report, in which the USDA may update their U.S. corn yield forecast, looms large,” said Tobin Gorey, director of agricultural strategy, Commonwealth Bank of Australia.
Yields in this year’s corn and soybean harvests are seen as hard to call after exceptionally late planting during a rain-plagued spring.
Private analytics firm IEG Vantage, formerly known as Informa Economics IEG, on Friday lowered its forecast of the average U.S. 2019 corn yield to 167.5 bushels per acre, from 169.6 a month ago, according to an IEG client note seen by Reuters.
IEG forecast the average U.S. 2019 soybean yield at 46.5 bushels per acre, down from 48.4 last month. The firm put soybean production at 3.513 billion bushels, down from 3.671 billion bushels previously.
— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Gus Trompiz in Paris and Colin Packham in Sydney.