U.S. soybean futures climbed on Monday on concerns supplies will run short before the autumn harvest because of strong demand and late plantings, while corn futures sagged.
Wet weather that has slowed the planting of soybeans and corn this spring is expected to continue, with occasional showers forecast in the Midwest over the next 10 days.
The U.S. Department of Agriculture, in a weekly progress report, said soybean planting was 57 per cent complete as of June 1, the slowest for this time of year since 1996.
The planting delays look to postpone the start of harvest, preventing farmers from replenishing tight inventories until later than previously expected. Supplies left over from last year’s drought-reduced harvest have diminished due to robust demand from buyers like top importer China.
“Soybeans are the definite leader, taking support from the fact that plantings remain delayed, and harvest will likely be delayed as well,” said Karl Setzer, a grain solutions team leader for MaxYield Cooperative in Iowa.
“We could see significant tightness in the cash soybean market prior to the start of the next harvest season,” he said.
Chicago Board of Trade July soybeans jumped 22-1/2 cents to $15.32-1/2 a bushel (all figures US$). November soybeans, which represent the crop that will be harvested in the fall, were up 21-1/4 cents at $13.25-1/2 a bushel after reaching a four-month high.
July corn fell 6-1/4 cents to $6.55-3/4 a bushel, while new-crop December corn dipped 7-1/4 cents to $5.60 a bushel after setting a two-month high earlier in the session.
Poor weather has raised concerns about reduced plantings and reduced yields for acres that are sowed. Late planting means key phases of crop development will likely be delayed until the heat of the summer.
USDA, in the weekly report, said 31 per cent of the soybean crop had emerged, below the five-year average of 49 per cent for this point in the season.
The corn crop was 91 percent planted, below the five-year average of 95 per cent, and 74 per cent emerged, below the five-year average of 82 per cent.
Morgan Stanley on Monday forecast 2013 U.S. corn plantings at 93.5 million acres, nearly 4 percent below USDA’s forecast, due to wet weather.
“More rain events in the forecast, delaying planting further and creating concern about tight U.S. supply, are enough to push prices higher,” Kayla Burkhart, a broker for SunPrairie Grain in North Dakota, said about soybeans.
In early trade, planting concerns boosted July corn as high as $6.69 a bushel. However, chart-based selling kicked in when the contract fell short of last week’s high of $6.69-3/4, driving prices lower, traders said.
Wheat edged higher as traders have largely shrugged off the risk of extended curbs in demand for U.S. exports following the discovery of an unauthorized type of genetically modified wheat in Oregon last week.
South Korea, a buyer of U.S. wheat, said it has not detected genetically modified wheat in initial tests of imports of the grain and flour.
However, the Asian nation will continue a suspension of U.S. wheat imports until it sees the final results of government tests on shipments from around the United States. The results are now expected on Wednesday.
“Both buyers and sellers would like to see this problem go away,” Jim Gerlach, president of A/C Trading, said about concerns of unauthorized wheat production.
CBOT July wheat rose 3-1/4 cents to $7.08-3/4 a bushel.
— Tom Polansek reports on agriculture and futures markets for Reuters from Chicago.