Chicago | Reuters –– U.S. corn and soybean futures fell on Thursday, pressured by forecasts for wet and warm weather in the Midwest that will foster early development of both crops in the coming weeks, traders said.
Wheat futures also dropped after a sharp rally on Wednesday despite reports of poor yields from a crop tour of Kansas.
Corn sagged 1.6 per cent. The outlook for rain overwhelmed a U.S. government report that showed old-crop export sales of corn topped expectations in the latest week.
“A rainout will hamper further Midwest planting this week but enable fantastic emergence,” Matt Zeller, director of market information at INTL FCStone, said in a note to clients.
CBOT July corn ended down 5-1/4 cents at $3.61-1/2 a bushel (all figures US$). The decline wiped out nearly all of the gains made during the previous two sessions.
Corn faced additional pressure from an outlook for record production of the grain in China as well as heavy deliveries against the expiring May contract.
CBOT July soybeans were 7-1/2 cents lower at $9.75 a bushel.
Weakness in the crude oil market, stemming from ample supplies, also weighed on soybeans.
CBOT July wheat was 6-1/2 cents lower at $4.72-3/4 a bushel. Wheat firmed early but a round of profit taking swamped the market after prices hit a one-week high.
“The market could not shake off dollar strength today,” Charlie Sernatinger, Global Head of Grain Futures at ED+F Man Capital, said in a note to clients.
Traders said U.S. wheat had been uncompetitively priced on the world market even before Wednesday’s 2.7 per cent gain.
“While the U.S. is struggling to export wheat, the rest of the world is not,” Tobin Gorey, director of agricultural research at Commonwealth Bank of Australia, said in a note to clients.
Scouts on the Wheat Quality Council’s annual tour of Kansas found prospects in the western portion of the state below the five-year average on Wednesday. Northern Kansas yields were projected at a 14-year low of 34.3 bushels per acre on Tuesday.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.