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Corn rises after deep losses, wheat struggles with ample supplies

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  • Corn up 0.2 pct after losing 5.2 pct over two days
  • Forecasts of favourable weather keep lid on corn futures
  • Wheat unmoved after decline, abundant supply weighs

Adds details, quotes

By Naveen Thukral

SINGAPORE, July 21 (Reuters) – Chicago corn edged higher on Thursday as the market took a breather after dropping to a two-week low in the previous session on forecasts of favourable U.S. crop weather.

Wheat was little changed following a near four percent decline in the past two days as it remained under pressure from large global stocks and bumper output from the U.S. winter crop.

Chicago Board Of Trade most-active corn contract Cv1 rose 0.2 percent to $3.45 a bushel by 0247 GMT, having lost 5.2 percent the last two days. On Wednesday, corn fell to a low of $3.41-1/2 a bushel, weakest since July 5.

Wheat Wv1 was unchanged at $4.13 a bushel and soybeans Sv1 gained 0.3 percent to $10.11-3/4 a bushel.

“We are in a bearish market, the USDA reports have been showing pretty high crop ratings for soybeans and corn,” said Kaname Gokon at brokerage Okato Shoji Co in Tokyo.

“Looks like it will be an early harvest this year which will keep pressure on the market.”

There was more rain added to the outlook for key growing areas of the U.S. Midwest, which will help protect the corn crop from the scorching temperatures expected over the next few days.

Additionally, temperatures are forecast to quickly moderate from their highs, easing stress on the crop as it pollinates.

For soybeans, with a critical period of development for much of the U.S. crop approaching, the latest U.S. weather reports call for adequate rain and moderate temperatures during August.

That outlook eased concerns about the La Nina weather phenomenon laying waste to yields.

Potentially giving a boost to corn prices, Argentine grain truckers started an open-ended strike on Monday over transport prices. Corn exports from Argentina, the world’s No. 3 supplier, could slow if farmers and the striking truck drivers fail to reach a deal, an exporters’ organisation said.

Commodity funds were net sellers of CBOT soybean, corn and wheat futures contracts on Wednesday as improving weather forecasts sparked further declines in prices.

U.S. corn yields still uncertain despite high July ratings

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By Mark Weinraub

CHICAGO, July 20 (Reuters) – A look at slumping corn prices would suggest that a huge U.S. harvest is a certainty, but crop data from previous bumper years shows there is a roughly 50 percent chance that come September, yields could be lower than current forecasts.

The U.S. Department of Agriculture (USDA) rated the corn crop as the second-best ever as of July 17 in its weekly report on Monday, sparking a sell-off in Chicago Board of Trade futures as the crop is now passed early development phases with little stress from adverse weather.

The biggest investment funds have already factored in a large crop according to latest figures from the Commodity Futures Trading Commission, which show they have sold off 95 percent of their net long stake in corn futures and options since mid-June.

Corn futures have now fallen 22 percent from the two-year highs hit just a month ago and closed on Tuesday at $3.48-1/2 a bushel for December delivery CZ6.

The USDA said on Monday that 76 percent of the corn crop was good to excellent as of July 17, up 1 percentage point from the start of the month and matching the second-highest mid-July ranking on record.

But strong mid-July ratings for the crop do not always correlate with final yields. Since 1993, in years with the 10 highest mid-July ratings, final yields have fallen from the government’s July estimate five times and risen five.

Market moves also have been a mixed bag in the 10 years with the best-rated crop, rising five times from mid-July to mid-September, when combines begin rolling, and falling five times. The market moves have not always correlated with the yield changes.

Adverse weather, ranging from extreme heat to heavy winds and flooding, can conspire to take the top off yield potential even late in the crop’s growth cycle.

The latest weather outlook calls for temperatures that may top 100 degrees Fahrenheit (38 C) in parts of the Corn Belt this week – just as much of the crop passes through its key pollination stage. Farmers say this could cause severe damage to yield prospects.

In central Nebraska, low soil moisture levels provide little protection to the crop from scorching temperatures, said Craig Frenzen, a farmer in that area who planted 2,000 acres of corn this year.

“We are very short of rain,” Frenzen said. “If we get the heat that we are talking about we will have very little … corn to harvest.”

But even if the government’s current projection of an average yield of 168 bushels per acre for corn is reduced, ample supplies of grain around the world provide a big cushion for the corn market, said Arlan Suderman, chief commodities economist at INTL FCStone.

Yields would have to fall below 160 bushels per acre – unlikely given current conditions – to pressure the balance sheet, Suderman added.

“The risk of that has not been eliminated but it is going significantly down,” Suderman said. “Enough of the crop is made to eliminate the need to ration supplies.”

GRAINS-Corn falls on USDA crop rating, weather forecasts cap losses

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SYDNEY, July 19 (Reuters) – U.S. corn futures fell nearly 1 percent on Tuesday after the U.S. Department of Agriculture pegged the condition of the U.S. crop at above market expectations, though concerns over unfavourable weather provided a floor to losses.

FUNDAMENTALS

* The most active corn futures on the Chicago Board Of Trade Cv1 fell 0.83 percent to $3.60-1/4 a bushel, having gained 1.4 percent in the previous session.

* The most active soybeans futures Sv1 lost 1 percent to $10.55-3/4 a bushel, having firmed 0.85 percent on Monday.

* The most active wheat futures Wv1 dropped 0.81 percent to $4.26 a bushel, having closed up 1.1 percent on Monday.

* USDA rated 76 percent of the corn crop as good to excellent, unchanged from a week earlier.

* Analysts surveyed by Reuters ahead of the report had expected a slight decline.

* USDA rated 71 percent of the soybean crop as good to excellent, unchanged from the previous week and in line with trade expectations.

* Weather in the U.S. Midwest remained the focus. Forecasts called for temperatures to reach the mid- to upper 90s Fahrenheit this week, with readings possibly topping 100 degrees F (38 C) from Missouri to South Dakota.

MARKET NEWS

* The yen hovered near 3-1/2-week lows on Tuesday on a combination of growing expectations of monetary easing by the Bank of Japan, a broad recovery in risk appetite and speculation about M&A-related yen-selling. USD/

* Oil prices eased in early Asian trade on Tuesday as concerns over a crude and fuel oil glut outweighed an expected cut in U.S. shale production and a likely further draw in U.S. crude stocks. O/R

* Wall Street closed slightly higher on Monday to mint new record highs for the S&P 500 and the Dow industrials, fuelled by Bank of America’s better-than-expected profit and a major tech sector acquisition.

U.S. corn jumps 1 pct as focus turns to hot weather, demand

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  • Corn snaps 2-session decline on f’cast of hot-dry weather
  • Wheat follows corn higher, soybeans largely unchanged

By Naveen Thukral

SINGAPORE, July 18 (Reuters) – Chicago corn rose one percent on Monday with the market snapping two sessions of declines as forecasts of hot and dry weather in the U.S. Midwest raised concerns about yield losses amid strong demand.

Wheat rose about half a percent on the back of gains in corn, although ample supplies kept a lid on the market, while soybeans were little changed.

The Chicago Board of Trade most-active corn contract Cv1 rose one percent to $3.62 a bushel by 0311 GMT, having lost 3.1 percent in the past two sessions.

Wheat Wv1 rose 0.5 percent to $4.27 a bushel and soybeans Sv1 were little moved at $10.57 a bushel.

“The U.S. Midwest received some welcome rain over the weekend, as did parts of the Southeast and Delta. Temperatures are expected to periodically rise above 40 degrees,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.

“The market will remain at the mercy of the weather models.”

Corn in the heart of the Midwest is pollinating, a crucial phase in determining yield. Hot and dry conditions during pollination can cut yield prospects.

At the same time there is strong demand for U.S. corn shipments amid lower production in rival supplier Brazil.

Large speculators cut their net long position in CBOT corn futures in the week to July. 12, regulatory data released on Friday showed.

The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and cut their net long position in soybeans.

The wheat market is being weighed down by ample world supplies and record yields being reported from the harvest of hard red winter wheat crop in the United States.

Record-high yields are helping U.S. farmers to harvest a bumper crop of hard red winter wheat, the most common variety here, but prices have tumbled as the world is awash in supplies.

The market is keeping a close watch on Argentina’s grain truckers who have threatened to go on strike on Monday if they do not reach a deal over hauling rates, the Federation of Argentine Transporters said on Friday.

The threat is the latest in a series of wage disputes driven by Argentina’s double-digit inflation rate. The country is the world’s top exporter of soymeal livestock feed, its No. 3 soybean supplier and No. 4 exporter of corn.

Soybeans edge up after sharp falls, market eyes August weather

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  • Soybeans tick up after falling almost 4 pct last session
  • Forecasts of U.S. Midwest rains weigh on prices, corn firms

Adds details, quotes

By Naveen Thukral

SINGAPORE, July 15 (Reuters) – Chicago soybeans edged up on Friday as the market took a breather, after sliding almost 4 percent in the previous session on pressure from forecasts of crop-boosting rains in the U.S. Midwest.

Corn gained 0.7 percent, while wheat added more than 1 percent.

The Chicago Board of Trade most-active soybean contract Sv1 was up 0.6 percent at $10.69 a bushel by 0275 GMT, while corn Cv1 rose 0.7 percent to $3.67-1/4 a bushel.

Wheat Wv1 was up 1 percent at $4.38-1/2 a bushel.

“The soybeans market has come under pressure and that can change again,” said Ole Houe, an analyst with brokerage IKON Commodities in Sydney.

“The market will be volatile, we see a 110 cents trading range in soybeans and 50 cents in corn. It will go on for a month or so.”

For the week, soybeans have gained 1.3 percent, partly recouping the 7 percent loss a week earlier. Corn Cv1 has risen 1.4 percent in what could be its first weekly gain in a month, while wheat Wv1 has added 0.9 percent, heading for its second straight weekly gain.

The latest weather outlook has reduced the likely duration of scorching temperatures across the U.S. corn belt next week. More rains have been forecast, which will help protect the crop from the searing heat.

A better-than-expected export report from the U.S. Agriculture Department on Thursday morning limited the sell-off in corn.

The USDA said old-crop export sales of corn came in at 667,800 tonnes last week and new-crop export sales were 687,800 tonnes. Both figures topped the high ends of a range of market forecasts. EXP/CORN

Commodity funds were net sellers of CBOT soybean, corn and wheat futures contracts on Thursday.

Traders’ estimates of net fund selling in soybeans ranged from 14,000 to 20,000 contracts. Funds were seen selling 8,000 to 11,000 corn contracts and 3,000 to 4,000 wheat contracts.

Corn near 2-wk high, soybeans up for 3rd day on US weather concerns

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  • Corn gains more ground on forecasts of hot, dry U.S. weather
  • Soybeans up 5 percent in three days of gains, wheat firms

Adds comment, detail

By Naveen Thukral

SINGAPORE, July 14 (Reuters) – Chicago corn futures rose 0.8 percent on Thursday, while soybeans hovered near their highest in more than a week, with forecasts of hot and dry weather across U.S. Midwest raising concerns about global supplies.

Wheat was up for a third day, although gains were capped by the outlook for ample global supplies.

The Chicago Board of Trade most-active corn contract Cv1 had climbed 0.8 percent to $3.72-3/4 a bushel by 0224 GMT, having gained 2.6 percent on Wednesday when prices hit $3.75-1/2 a bushel, their highest since June 30.

Soybeans Sv1 rose 0.5 percent to $11.10-1/2 a bushel, having climbed in the last session to $11.19-1/2 a bushel, the strongest since July 5.

Weather forecasts showed rising temperatures and decreasing rainfall in the U.S. Midwest during early August, a critical time for soybean development.

“Concerns about dry weather due to La Nina weather has given upside response to prices,” said Phin Ziebell, agribusiness economist, National Australia Bank.

“The real story is that a lot of corn has gone in the ground and production doesn’t look terrible.”

U.S. corn supplies will tighten more than expected in the coming months due to rising exports, the U.S. Department of Agriculture said in its monthly supply and demand report on Tuesday.

The most active wheat futures Wv1 rose 0.6 percent to $4.42-1/4 a bushel, having closed up 0.3 percent on Wednesday.

Wheat’s gains lagged corn and soybeans due to plentiful global supplies and expectations that the big U.S. harvest will add to the glut.

Still, heavy rain and strong winds are likely to curb the potential for Western Canada’s crops, government officials said, but the harvest may still be bigger than average.

Pockets across Saskatchewan, Canada’s biggest wheat- and canola-growing province, received as much as 5 inches (127 millimetres) of rain, strong winds and hail since Sunday.

Strong demand is boosting French wheat exports. Farm office FranceAgriMer on Wednesday raised its estimate for French soft wheat exports in 2015/16 to a near-record, leading it to trim again expected stocks in the European Union’s biggest wheat producer.

Commodity funds were net buyers of Chicago Board of Trade soybean, corn and wheat futures contracts on Wednesday.

Traders’ estimates of net fund buying in corn ranged from 13,000 to 16,000 contracts. Funds were seen as net even to buyers of 2,000 wheat contracts. They bought an estimated 7,000 soybean contracts.

GRAINS-Soybeans dip after rally, adverse weather forecast supports prices

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  • Soybeans ease after climbing to highest in more than a week
  • Forecasts of hot, dry weather across Midwest underpin prices

Adds comment, detail

By Naveen Thukral

SINGAPORE, July 13 (Reuters) – Chicago soybeans edged lower on Wednesday as the market took a breather after last session’s strong gains that were driven by forecasts of crop-damaging hot and dry weather across the U.S. Midwest.

Corn was little changed following a 1.5-percent rally on Tuesday, supported by a U.S. Department of Agriculture report showing tighter supplies of the feed grain.

The Chicago Board of Trade most-active soybean contract Sv1 slid 0.3 percent to $10.84 a bushel by 0220 GMT, after rallying over 3 percent in the last session. The market earlier hit its highest since July 5 at $10.97 a bushel.

Corn futures Cv1 gained 0.1 percent to $3.60-1/2 a bushel and wheat Wv1 gave up 0.1 percent to $4.38-1/4 a bushel.

“The market’s next concern is the forecast of adverse weather in the coming weeks when soybeans will in the pod-setting stage,” said Kaname Gokon at brokerage Okato Shoji in Tokyo. “Hot and dry weather will potentially reduce yields.”

Soybeans are drawing support amid worries about stressful crop conditions as forecasters said above-normal temperatures and near-normal to below-normal rainfall may spread across most of the U.S crop belt next week.

U.S. corn supplies will tighten more than expected in the coming months due to rising exports, but a bumper harvest will quickly re-stock grain bins, the USDA said on Tuesday.

The agency pegged 2015/16 U.S. corn stocks at 1.701 billion bushels, down 7 million bushels from its June estimate.

It predicted a big domestic soybean harvest would help offset rising overseas demand for U.S. supplies of the oilseed.

The USDA is likely to boost the already massive yield forecast in the coming months, according to historical data that show estimates of big crops tend to grow even larger as harvest time nears.

There is support for wheat with the outlook of lower production in France.

France’s farm ministry expects the country’s soft wheat production to shrink by almost 10 percent this year after heavy rain and limited sunshine hurt crops in the European Union’s biggest grain grower.

In its first estimate of 2016 soft wheat production on Tuesday, the ministry forecast a crop of 36.95 million tonnes, down 9.7 percent from 2015’s record volume of 40.9 million tonnes.

Commodity funds were net buyers of CBOT soybean, corn and wheat futures contracts on Tuesday. Traders’ estimates of net fund buying in soybeans ranged from 8,000 to 10,000 contracts and in corn from 3,000 to 6,000 contracts.

Corn hits 10-day high, soybeans up for second day on weather concerns

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  • Corn up for fourth day, hits highest since July 1
  • Soybeans rise for 2nd day on forecasts of dry weather

By Naveen Thukral

SINGAPORE, July 11 (Reuters) – Chicago corn futures climbed to a 10-day high on Monday, while soybeans gained for a second session with prices underpinned by forecasts of hot and dry weather for the key U.S. Midwest producing region.

Wheat was little changed after rallying on Friday on the back of gains in corn and beans.

The most-active corn contract Cv1 on the Chicago Board Of Trade rose one percent to $3.66-1/4 a bushel by 0312 GMT, having hit a session high of $3.68 a bushel, strongest since July 1. Corn jumped 4 percent in the previous session.

Soybeans Sv1 rose 1 percent to $10.68 a bushel and wheat Wv1 was flat at $4.35 a bushel.

Corn and soybeans drew support on forecasts for hot and dry weather, stoking concerns about stress on both crops as they head toward key developmental phases.

“U.S. Midwest is facing weather problems, one-month forecast is showing hot and dry weather starting at the end of July,” said Kaname Gokon at brokerage Okato Shoji in Tokyo. “It could impact soybean crop yields.”

Strong demand for beans is providing additional support.

The U.S. Department of Agriculture said early on Friday that weekly old-crop export sales of soybeans totalled a bigger-than-expected 637,300 tonnes. New-crop export sales of 585,700 tonnes were in line with market forecasts.

In bullish news for the corn market, India has asked a government-backed trader to import an extra half a million tonnes of duty-free, non-genetically modified corn to keep a lid on domestic prices and overcome any shortage, the trade ministry said on Sunday.

Rising domestic demand and stagnating production has seen India turning into a net importer from an exporter.

Commodity funds were net buyers of CBOT corn, soybean and wheat futures contracts on Friday. Traders’ estimates of fund purchases in corn ranged from 5,000 to 11,000 contracts. They bought between 3,000 and 4,500 wheat contracts and 8,000 soybean contracts.

EU trims wheat crop outlook, slashes rapeseed

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PARIS, July 8 (Reuters) – The European Commission on Friday trimmed its forecast for this year’s soft wheat harvest in the EU but said the bloc remained on course for an above-average crop as strong prospects in the south and east should offset weather problems elsewhere.

Wheat harvesting is under way in the European Union and grain markets are weighing the risk of crop damage in France against signs of bumper yields in countries such as Romania.

The 28-country EU is collectively the world’s biggest wheat grower and exporter.

The Commission projected usable soft wheat production in the EU at 144.6 million tonnes, down from 145.1 million in its previous estimate a month ago.

This confirmed an expected sharp fall from a record 151.6 million tonnes in 2015, but would still be 5 percent above the average production of the past five years, according to data in an agricultural market report posted on the Commission website.

“Despite recent heavy rains across main grains producing regions in the EU, the coming cereal harvest could be the third bumper crop in a row,” the Commission said.

Countries including Spain, Romania and Hungary were seeing particularly good conditions for cereals, in contrast to weather setbacks further north, notably rain and storms in France and Germany that have flattened some crops and fuelled the spread of crop disease, it said.

The EU’s executive arm raised slightly its outlook for this year’s barley production to 62.4 million tonnes from 62.2 million, which is above last year’s 60.6 million.

It cut its forecast for grain maize production to 65.2 million tonnes from 65.8 million previously, but this would still be well above a weather-hit 2015 crop of 58 million.

The expected rebound in maize output would support a slight rise in total cereal production to 312.8 million tonnes from 310.3 million last year.

In oilseeds, the Commission sharply lowered its rapeseed crop estimate to 20.8 million tonnes from 22.0 million, putting the crop at a four-year low.

“Yields were affected among others by the cold spell in April in France, the pressure of disease following the excessive rainfalls of May-June in continental Western Europe and dry conditions in northern-eastern Germany,” it said.

However, total oilseed output in the EU was expected to be almost unchanged from last year at 31.6 million tonnes, supported by better yield prospects for the smaller soybean crop.

Posted in Ag

Soybeans face biggest weekly loss in 2 years on U.S. weather

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  • Soybeans down almost 10 pct this wk, biggest since June 2014
  • Funds sell soybean contracts as ideal U.S. weather aids crop

Adds comment, detail

By Naveen Thukral

SINGAPORE, July 8 (Reuters) – Chicago soybean futures were on Friday set for their biggest weekly decline since June 2014 as near-perfect U.S. weather boosted the prospects of a bumper crop.

Corn is poised for a third week of decline as the U.S. crop thrives in friendly weather in its crucial pollination phase, while wheat is on track to suffer its fifth week of losses.

Chicago soybean futures Sv1 have lost nearly 10 percent this week, their biggest weekly fall since June 2014 as rains aid the U.S. crop and fears of dry La Nina weather pattern ease.

“There is long liquidation in soybeans,” said Kaname Gokon at brokerage Okato Shoji in Tokyo.

“There have been heavy rains in the U.S. Midwest which are good for the crop.”

Expectations by weather forecasters that the onset of a La Nina, which could trigger a dry summer in the U.S. Midwest, had been pushed back to September suggest soybeans will not get hit during their key development stage in August, CBA analysts said.

Corn Cv1 has lost 4.5 percent this week, falling for a third consecutive week, while wheat Wv1 is down more than 1 percent in its fifth week of losses.

Corn has given up close to 20 percent in three weeks and wheat has shed more than 14 percent in five weeks.

The U.S. corn crop is getting a boost from rains and ideal weather in its pollination phase.

Still, the decline in corn futures is being limited by Brazil’s Conab lowering its outlook for the country’s corn production to 69.14 million tonnes from 76.22 million, largely due to problems with the second crop.

Commodity funds were net sellers of Chicago Board of Trade soybean and wheat futures contracts on Thursday. Traders’ estimates of fund sales in soybeans ranged from 14,000 to 20,000 contracts.

Estimates for wheat ranged from net even to sales of 2,500 contracts. Traders estimated that funds were net even in corn. COMFUND/CBT

Meanwhile, exports of French soft wheat, which competes with U.S. wheat, to buyers outside the European Union rose in May to 1.6 million tonnes, the highest monthly volume since the 2015/16 season began in July last year.

Exports since the beginning of the 2015/16 season now total 11.4 million tonnes, up 12 percent from the July-May period in 2014/15.