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Wheat ticks up after deep losses, U.S. yields in focus

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  • Chicago wheat edges higher after Tuesday’s over 3 pct fall
  • Dryness trims North Dakota spring wheat yield prospects
  • Soybeans up for 2nd day as market recovers from 3-month low

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By Naveen Thukral

SINGAPORE, July 27 (Reuters) – Chicago wheat rose on Wednesday as the market recovered from a more than three percent fall in the previous session, supported by a widely watched crop tour that found lower U.S. spring wheat yield prospects.

Corn edged higher after closing about half a percent lower while soybeans rose for a second session on bargain buying following a decline to three-month low on Tuesday.

The Chicago Board Of Trade’s most-active wheat contract Wv1 rose 0.4 percent to $4.16-3/4 a bushel, having closed down 3.3 percent on Tuesday on pressure from ample global supplies.

Corn Cv1 gained 0.4 percent to $3.40-3/4 a bushel and soybeans Sv1 added 0.8 percent to $9.81-1/2 a bushel.

Yield prospects for hard red spring wheat in southeast North Dakota were below average following a dry spell earlier this year, scouts on an annual crop tour said on Tuesday.

The wheat crop in the southeastern corner of the state was developing one to two weeks ahead of normal, aided by early planting as well as dry weather in May and June that may have advanced the crop’s maturity.

Reduced estimates for the harvest in the top exporting region of the European Union had pushed Chicago wheat to a 10-day high on Monday, but ample global supplies are keeping a lid on prices.

“There are some periodic concerns about yields and adverse weather but overall global supplies are looking really good,” said Phin Ziebell, agribusiness economist at National Australia Bank.

“You need to see a big decline in yields or significant period of adverse weather for prices to rally. There are some bargains to be had but beyond that it is all about fundamentals.”

For soybeans, extended weather forecasts reaching into August – the most crucial month for establishing U.S. yields – showed sufficient precipitation that could help offset the potential for stress caused by high temperatures.

Midday weather models on Tuesday showed a stronger ridge of high pressure in the central United States growing belt that could lead to increased dryness, according to an agriculture meteorologist at Lanworth, a division of Thomson Reuters.

The U.S. Department of Agriculture after the close of trading on Monday left good-to-excellent condition ratings unchanged for the U.S. soybean and corn crops, when analysts were predicting slightly lower ratings due to heat. US/COR, US/SOY

Historically high U.S. crop ratings increased the likelihood for higher-than-normal yields at harvest.

Brazil 2016/17 soy area should grow modestly – AGR Brasil

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SAO PAULO, July 26 (Reuters) – The area planted with soy in Brazil in 2016/17 should grow 2 percent to 33.8 million hectares as some farmers favor corn, Chicago-based analysts AGR Brasil told Reuters on Tuesday.

Brazil is facing a corn shortage, driving local prices up to record highs and changing a trend of farmers favoring soybeans in recent years. Soy planting will start in late September but farmers need to finalize their decisions now.

“The increase in summer corn, in our opinion will not threaten the increase in soy area but will merely limit its growth,” AGR Brasil’s President Pedro Dejneka said in an interview.

The soy crop could be 98 million to 108 million tonnes, according to AGR Brasil.

“The forecast is still for La Niña … but it is possible that it is a moderate La Nina,” Dejneka said, explaining that the climate phenomenon tends to lead to favorable rains and temperatures in most agricultural areas.

La Nina, however, tends to hurt the far southern state of Rio Grande do Sul as well as neighboring Argentina, he said.

U.S. corn, soy crop ratings seen declining on heat stress

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CHICAGO, July 25 (Reuters) – The U.S. Department of Agriculture will likely show decreased condition ratings for U.S. corn and soybean crops after hot temperatures stressed developing plants last week, a Reuters poll of 10 analysts showed on Monday.

USDA in its weekly crop progress and conditions report due at 3 p.m. CDT (2000 GMT) is expected to show corn ratings at 75 percent good to excellent and soybeans at 70 percent good to excellent, each down 1 percentage point from last week, according to average analyst estimates. US/CORUS/SOY

Hotter-than-normal temperatures negatively impacted corn and soybean fields, especially in the lower half of the United States, while crop conditions also tend to ease seasonally in the warmest days, the analysts said.

However, plentiful rainfall in much of the U.S. Corn Belt limited the potential for heat damage, they said.

Analysts expect the government to report 69 percent of the U.S. spring wheat crop as good to excellent, unchanged from a week earlier. US/WHE

They predicted the winter wheat harvest would advance to 86 percent complete, up from 76 percent in the previous week.

All figures below in percent:

Category Average Range Prior week
Corn condition* 75 74-76 76
Soybean condition* 70 70-71 71
Spring wheat condition* 69 68-69 69
Winter wheat harvested 86 81-89 76
*Percent good/excellent

Corn faces 5th week of losses as U.S. weather improves, soy falls

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  • Corn extends decline on forecasts of cooler U.S. weather
  • Soybeans give up Thursday’s gains, wheat little changed

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By Naveen Thukral

SINGAPORE, July 22 (Reuters) – Chicago corn futures were on track for a fifth consecutive week of decline on Friday as an outlook for cooler temperature across the U.S. grain belt boosted expectations of a bumper crop.

Soybeans slid, giving up overnight gains, while wheat was steady after ending up on Thursday with prices underpinned by concerns over wet weather hurting crops in Europe.

Chicago Board of Trade most-active corn contract Cv1 has lost 5.2 percent this week. Soybeans Sv1have also given up about 5 percent after finishing last week largely unchanged.

Wheat Wv1, however, is down more than 1 percent in its second week of decline.

“For corn, (adverse) weather concerns for the U.S. crop have failed to materialise. A lot of speculative length has been unwound,” said Brett Cooper, senior manager for markets at FCStone Australia.

“One supporting factor in the wheat market has been the impact of very wet couple of months in Europe, lowering quality and yields.”

The latest U.S. weather view calls for high temperatures currently hovering over the corn belt to quickly moderate, with some beneficial rains also in the mix for the weekend.

There is additional pressure on corn stemming from U.S. data showing a drop in demand.

A weekly U.S. Department of Agriculture report said that old-crop corn export sales came in at 345,100 tonnes in the seven days ended July 14, down from 667,777 tonnes a week ago.

New new-crop sales were 506,300 tonnes, down from 687,843 tonnes. The old-crop figure was below market forecasts while the new-crop number was in line with expectations.

New-crop soybean export sales totalled a bigger-than-expected 1.002 million tonnes, sharply up from 547,046 tonnes a week earlier. Old-crop soybean sales were 325,000 tonnes.

In more bearish news, Argentina raised its view for the country’s 2015-16 soybean and corn crops on robust yields.

The Agriculture Ministry said it now expects 39.8 million tonnes from the 2015-16 corn crop, up from 37.9 million in its last monthly report, and it forecast 58.8 million tonnes of soybeans, compared with 58 million before.

Commodity funds were net sellers of CBOT corn futures contracts on Thursday. They were net buyers of wheat contracts and even in soybeans.

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

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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

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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

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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.