U.S. grains: Soybeans at six-week low on U.S. acreage view

(USDA.gov via Flickr)

Chicago | Reuters — U.S. soybean futures fell to a six-week low on Thursday on expectations for a big South American harvest and an expansion in U.S. plantings this spring, analysts said.

Corn futures fell on chart-based selling and wheat followed the weak trend.

The Chicago Board of Trade March soybean contract settled down 11-1/4 cents at $10.11-1/2 per bushel after dipping to $10.10, its lowest level since Jan. 12 (all figures US$).

CBOT March corn ended down 5-1/2 cents at $3.65-1/2 a bushel and March wheat fell 3-1/4 cents to $4.38 a bushel.

Soybeans fell after the U.S. Department of Agriculture at its annual outlook conference projected U.S. soybean plantings for 2017 at 88 million acres, a record high if realized. The figure was just above an average of trade expectations in a Reuters poll for 87.6 million.

“It’s going to be a tough chore for soybeans, with already big carry-out numbers, huge crops out of South America and then increased planted acres here in the United States,” said Brian Hoops, analyst with Midwest Marketing Solutions.

South American farmers are expected to produce a massive crop, with the harvest already well under way in Brazil. Agroconsult, a Brazilian consultancy, on Wednesday raised its forecast for the country’s 2016-17 soy crop to 107.8 million tonnes, up from its Feb. 8 estimate of 105.3 million.

CBOT corn fell even though USDA projected U.S. 2017 plantings at 90 million acres, down 4.3 per cent from 2016 and below an average of trade expectations in the Reuters poll for 91 million.

The CBOT March corn contract fell below chart support at its 200-day moving average near $3.67 and dipped to $3.65-1/4, its lowest level since Feb. 7.

Commodity funds recently shifted from a net short position in CBOT corn futures to a net long, leaving the market vulnerable to long liquidation.

Wheat futures fell, retreating a day after a 1.2 per cent rally in the March contract.

USDA projected U.S. total wheat plantings for the 2017 harvest at 46.0 million acres, below an average of trade expectations in a Reuters poll for 46.85 million.

However, massive domestic and global supplies of wheat continue to hang over the market.

Argentina will likely harvest a record-large 18.3 million tonnes of wheat, Agriculture Minister Ricardo Buryaile said. USDA currently forecasts Argentina’s crop at 15 million tonnes.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.

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