Chicago Board of Trade corn futures fell 1.1 per cent to their lowest in more than three years as harvest of the U.S. crop ramped up across broad stretches of the Midwest, traders said.
Soybean futures also fell, pressured by a combination of harvest pressure and technical selling.
Wheat rose, posting a one per cent gain on bargain buying after prices fell to their weekly lows during the overnight trading session. Concerns about a tightening supply situation in Argentina added to the bullishness.
Corn’s drop extended a sell-off that began on Thursday. The corn market typically hits a seasonal low when farmers have harvested around 50 per cent of their crop.
“The corn has pressed through to new lows overnight on follow through selling,” Sterling Smith, futures specialist for Citi, said in a note to clients. “Bigger yields are being reported as producers start harvesting more corn and will continue to weigh on prices.”
The U.S. Agriculture Department did not provide an update on harvest progress this week due to the partial shutdown of the federal government. Analysts estimated that harvest was 50 per cent complete as of Oct. 6 and farmers in most areas have had good weather for harvesting since then.
CBOT December corn futures settled down 5 cents at $4.33-1/4 a bushel (all figures US$). Prices bottomed out at $4.32-1/2, the lowest since Sept. 3, 2010, during overnight trading.
CBOT November soybeans fell 21-1/4 cents to $12.66-3/4 a bushel. Losses accelerated when the contract dropped below its 100-day moving average, a key technical level.
“The crop may turn out larger than expected,” said Anne Frick, oilseeds analyst with Jefferies Bache in New York. “But even if it doesn’t in the United States, you are still looking at very strong production prospects in Brazil particularly, but South America in total. So that is putting pressure on the soybeans and the meal.”
Soybeans also faced technical pressure after dropping below the 50 per cent point on a Fibonacci retracement from the late-summer rally to an 12-month high.
CBOT soft red winter wheat for December delivery was up 6-3/4 cents to $6.92-1/4 a bushel. KCBT hard red winter wheat and MGEX spring wheat posted modest gains.
Some additional support came from reduced forecasts for Russia’s 2013 grain crop on Friday as unfavourable conditions delayed harvesting in the Siberia region.
For the week, corn fell 2.3 per cent, soybeans were down 2.2 per cent and wheat was up 0.7 per cent.
The market traded without insight from a key crop report that was not released due to the government shutdown, the first time in 40 years the monthly update was not issued.
Traders typically rely on the USDA report, which covers everything from the size of the U.S. corn harvest to China’s soybean imports, to help forecast market direction.
— Mark Weinraub is a Reuters correspondent covering grain futures markets in Chicago. Additional reporting for Reuters by Julie Ingwersen in Chicago.