U.S. grains: Exports pressure corn, soybeans

(Photo courtesy Canada Beef Inc.)

Chicago | Reuters — Chicago Board of Trade corn and soybean futures fell on Friday on signs of weakening demand for U.S. exports as the South American harvest nears, traders said.

Wheat futures also dropped, pressured by a round of profit-taking after K.C. hard red winter wheat hit a 4-1/2-month high. But concerns about crop damage from a cold snap in key growing areas as well as positioning ahead of expected fund purchases limited declines in the wheat market.

Soybeans notched the biggest decline, sinking 1.8 per cent, while corn dropped 0.9 per cent. The weekly export sales totals for both crops were marketing year lows.

“Export business was rather dismal across the board,” said Mark Schultz, chief analyst at Northstar Commodity Investment Company. “It was well below what I thought was taking place.”

The U.S. Agriculture Department said early Friday that weekly soybean export sales fell to a lower-than-expected 87,700 tonnes, old and new crops combined, in the latest week from 979,200 tonnes a week ago. Corn export sales of 429,300 tonnes also dropped below the low end of trade forecasts.

The market also was pricing in the possibility that a slowdown in the movement of soybeans to U.S. West Coast ports, due to wintry conditions, would cause China to cancel previously booked deals and buy from Brazil or Argentina instead, Schultz added.

Record snow and rain pummelled the western United States on Thursday, raising the threat of floods and freezing temperatures in some areas.

CBOT March soybeans settled down 17-3/4 cents at $9.94-3/4 a bushel. CBOT March corn was 3-1/4 cents lower at $3.58 a bushel.

CBOT March soft red winter wheat was three cents lower at $4.23-1/4 a bushel. K.C. March hard red winter wheat was down one cent at $4.33-1/2 a bushel after peaking at $4.38-3/4 a bushel, its highest since Aug. 23.

Wheat futures have been supported this week by traders adjusting their bets on the grain before a rebalancing of investment portfolios by index funds next week.

“Wheat is also being underpinned by fears of cold weather in parts of the United States and eastern Europe, including Ukraine and Russia, along with the money flow generated by the fund rebalancing,” said Matt Ammermann, commodity risk manager at INTL FCStone.

For the week, soybeans fell 0.9 per cent and corn rose 1.9 per cent. CBOT SRW was up 3.9 per cent. K.C. HRW was up 4.1 per cent.

— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Naveen Thukral in Singapore.

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