Chicago | Reuters — U.S. wheat and corn futures fell on Thursday on disappointing export sales and prospects for rising global inventories, traders said.
Soybean futures closed steady to modestly higher as a pick-up in export demand helped a cautious market rebound from multi-month lows this week.
At the Chicago Board of Trade, September wheat settled down seven cents at $4.03-1/4 per bushel and December corn ended down four cents at $3.31 a bushel (all figures US$). Most-active November soybeans settled up 1-1/4 cents at $9.56-3/4 a bushel.
Wheat’s decline erased much of Wednesday’s short-covering rally as traders turned their attention to rising world stockpiles and weak export demand for U.S. supplies.
The U.S. Department of Agriculture reported weekly export sales of U.S. wheat for the current crop year at 326,500 tonnes, below trade expectations for 350,000 to 650,000 tonnes.
“Wheat caught another wave of chart selling and disappointment over the export sales report this morning, amid more talk of perfect-looking crops in Canada,” ED+F Man Capital analyst Charlie Sernatinger said in a note to clients.
Traders noted that Russia is expected to harvest the largest wheat crop in its post-Soviet history this summer.
“Upward momentum in wheat is also being restrained by the expectations of a very large wheat harvest in Russia while the U.S. is not playing a leading role in the world export market to the mainstream destinations,” said Stefan Vogel, head of agricultural commodity markets research at Rabobank.
CBOT corn futures hovered near two-year lows established on Monday as mostly favourable weather in the U.S. Midwest bolstered expectations for a big crop.
Commodity brokerage Linn and Associates on Wednesday projected U.S. 2016 corn production at 14.775 billion bushels and soybean production at 4.073 billion bushels, both record highs.
On Monday, INTL FCStone, another brokerage, also projected record-large corn and soy harvests.
In the soybean market, the benchmark November contract closed modestly higher on strong export demand but front months settled flat, erasing gains in the final minutes of trade.
Soybean futures rose after USDA reported better-than-expected export sales in the week to July 28, and announced a seventh consecutive daily sale of U.S. soybeans.
“Soybean futures found support on weekly U.S. old- and new-crop soybean export sales that were at the upper end of expectations, on ongoing aggressive U.S. soybean export sales to China and on strength in soybean oil,” DC Analysis president Dan Cekander wrote in a note to clients.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Michael Hogan and Colin Packham.