By Paulo Trevisani
Corn for December delivery fell 3.3% to $ 5.43 a bushel on Friday on the Chicago Board of Trade as weather forecasts declined with the prospect of rain aiding crop yields.
Wheat for delivery in September fell 1.2% to $ 6.84 a bushel
– Soybeans for November delivery fell 0.8% to $ 13.51 3/4 a bushel.
Suction Story: Grain futures slipped as rain expectations dampened fears of shortage of supply due to hot and dry conditions. “The weather outlook for the plains looks wetter from late weekend to early next week,” Futures International said of Corn. Meanwhile, the USDA reported flash export sales of 100,000 tons of soybeans for delivery to Mexico in marketing year 2021/22, but overall weak export data continued to weigh on prices.
Weighed Wheat: Weak exports and weather forecasts drove the most active wheat contract down. Harvests around the world continue to be under pressure from extreme weather conditions, but traders seemed to see an opportunity for a correction. The continuously most active wheat futures gained around 3.8% last month and 7.6% so far this year. Price support can still return, however. “Bad weather is returning as hot and dry conditions are forecast for the next several weeks,” said Price Futures. “World prices may have bottomed out and should start moving up, which is helping wheat futures markets in the US.”
Condition of Maize: The maize fell on signs of possible rainfall that could mitigate production losses from dry weather. But it could change quickly depending on how the projections play out. “Fundamentals haven’t changed much, hot and dry weather in the Midwest continued to take center stage,” said RJO. “Historically, this time of year we typically see a fall in corn, but so far it has not,” the broker said, recalling that Monday’s crop condition report may set the tone, “as the market is looking for a fundamental catalyst . ”
Storage Ahead ?: Weather forecasts and weak export data weighed on grain prices a day after the USDA reported disappointing overseas sales of US corn and soybeans. There is debate about how long the heat will last around the farmland and whether there will be bearish rains. AgriVisor reports that some grain producers are considering storing their old corn and soybean crops with the upcoming harvest.
Credit Matters: Credit availability was a factor in wheat prices, Marex said, along with predictions of tight supply and strong demand. “The structural link between credit and price has held up well over the past few years. Unfortunately, in 2001 we saw a separation between credit creation and wheat prices,” said the broker, adding that this could make imports more difficult. “We qualify the divergence as’ negative ‘, eg declining credit and rising prices, based on the assumption that short-term credit eases importers’ demand.” Marex said the divergence is starting to close. “On the whole, this is a price-positive development.”
– The USDA will release its weekly export control report on Monday at 11 a.m. ET.
– The USDA will release its weekly crop progress report on Monday at 4:00 p.m. ET.
– The EIA will release its weekly report on ethanol production and inventory levels on Wednesday at 10:30 a.m. ET.
– The USDA will release its weekly export sales report on Thursday at 8:30 a.m. ET.
Write to Paulo Trevisani at [email protected]
(END) Dow Jones Newswires
07-23-21 1537 ET