Chicago | Reuters – Chicago soybean and grain futures fell on Friday as weather conditions improved and investors expected harvest conditions to improve in the U.S. Midwest, traders said.
Corn and soybean futures had a particularly choppy trading session as a spate of bearish signs prompted investors to de-risk by the end of the week.
The most active soybean contract on the Chicago Board of Trade (CBOT) closed 10-3/4 cents lower at $13.07-1/2 a bushel (all data in US dollars). Corn closed nine cents lower at $4.87-1/4 a bushel and wheat closed 11 cents lower at $6.26-3/4 a bushel.
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Soybean futures were mixed at the start of the session and corn firmed after the US government forecast that dry conditions early in the growing season this fall would result in lower harvests of both varieties.
But forecasts from the US Department of Agriculture’s (USDA) monthly World Agriculture Supply and Demand Estimates (WASDE) report fell short of market expectations.
If the corn harvest is realised, it would be the second-biggest ever due to the large acreage and the improvement in growing conditions in the important development month of July.
Then traders ignored the USDA’s news that farmers participating in US crop subsidy programs reported “prevented plantings” of 1,421,488 acres of corn, 458,915 acres of soybeans and 640,761 acres of wheat through Aug. 9.
“The simple fact is that there just wasn’t enough news today to push the market higher,” said Karl Setzer, head of brokerage research at Mid-Co Commodities.
And with many weather forecast models now predicting that the U.S. Midwest will not experience a severe heatwave in late August, “the majority of traders are now anticipating an improvement in crop conditions next week,” said Setzer.
Meanwhile, Chicago Board of Trade wheat futures tumbled as the WASDE report showed that ending wheat inventories were improving, particularly for hard red winter wheat, said Craig Turner, commodities trader at Daniels Trading.
And the absence of another escalation of the war in the Black Sea also weighed on wheat futures, traders said.
– Reporting for Reuters by PJ Huffstutter in Chicago; additional reporting by Thomas Polansek and Mark Weinraub in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore.
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