Chicago | Reuters — U.S. wheat futures fell nearly two per cent on Wednesday on forecasts for much-needed moisture in the southern Plains, analysts said.
Corn and soybean futures also declined as traders adjusted positions ahead of key crop data due on Thursday from the U.S. Department of Agriculture.
Chicago Board of Trade March wheat settled down eight cents at $4.18-3/4 per bushel after dipping to $4.12, its lowest in a week (all figures US$).
CBOT March corn ended down one cent at $3.57-1/4 per bushel and March soybeans fell 2-1/4 cents at $10.11-1/2 a bushel.
Wheat posted the biggest decline on a percentage basis, pressured by expectations that weekend storms would help recharge soil moisture in Oklahoma and Kansas, where dry conditions have stressed dormant hard red winter wheat crops.
Precipitation totals over the next five days could reach two to four inches or more on the southern Plains, the U.S. Department of Agriculture said in a daily weather bulletin.
“It’s the forecast for some pretty decent moisture for the hard red winter wheat areas,” Tom Fritz, a partner with EFG Group in Chicago, said of the decline in wheat futures. “You’ve elected sell-stops, and that spills over into corn and the bean complex,” Fritz said.
Also bearish, a substantial snow layer protected winter crops in Ukraine and Russia from severe frosts this past weekend, experts said on Tuesday.
Corn and soybeans followed wheat lower, with investors stepping to the sidelines ahead of the release of several U.S. government crop reports.
USDA will release a series of reports on Thursday at 11 a.m. CT, including U.S. quarterly grain stocks, U.S. annual crop production, U.S. winter wheat seeding and its monthly World Agricultural Supply and Demand Estimates (WASDE).
“Soybeans, wheat and corn are weaker today as people take risk off the table ahead of the USDA report on Thursday,” said Graydon Chong, senior commodity analyst with Rabobank.
“There will be a huge amount of data to digest from the USDA and although I do not think the market is expecting major surprises, some participants are taking a step back for the moment,” Chong said.
Corn drew additional pressure from news that China raised dumping tariffs on imports of U.S. distillers’ dried grains (DDGs), an animal feed ingredient derived from corn, from levels first proposed last year. The move marked a major victory for China’s fledgling ethanol industry.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Michael Hogan and Naveen Thukral.