Chicago | Reuters — U.S. wheat futures sank to multi-year lows on Thursday, weighed down by ample supplies and weak demand for U.S. exports, traders said.
A hefty supply base also sparked a sell-off in corn, which hit its lowest level since mid-June, while soybeans sagged on technical selling and rising harvest expectations.
The Chicago Board of Trade (CBOT) reported heavy deliveries against expiring wheat and corn contracts on Wednesday evening, reflecting the easy availability of supplies on the cash market.
K.C. hard red winter wheat fell to its lowest price since April 4, 2007, during Thursday’s trading session while CBOT soft red winter wheat hit its lowest level since June 30, 2010.
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Export demand has picked up as prices have fallen but U.S. supplies remain uncompetitive on the global market.
Egypt’s government buyer announced that it bought 170,000 tonnes of Russian wheat in its latest tender, extending this season’s string of purchases from Black Sea countries. There was no U.S. wheat offered for sale in the deal.
“No matter what the price, it seems like the U.S. can’t do much in terms of export business,” said Mike Krueger, president of the Money Farm, a grain market advisory service near Fargo, N.D. “You have everyone running for cover.”
CBOT December soft red winter wheat settled down 13-3/4 cents at $4.65-1/4 a bushel while K.C. December hard red winter wheat dropped seven cents to $4.67-3/4 a bushel (all figures US$). Both contracts set fresh lows on Thursday.
The U.S. Agriculture Department said on Thursday morning weekly export sales of wheat for 2015-16 shipment totalled 277,500 tonnes, near the low end of expectations.
CBOT December corn ended down six cents at $3.61-1/2 a bushel while CBOT November soybeans were 4-1/2 cents lower at $8.69-1/2 a bushel.
Forecasts for good weather that will help shepherd both corn and soybean crops toward maturity around the U.S. Midwest have bolstered harvest expectations.
Private analytics firm Informa Economics raised its projections for corn and soybeans on Thursday, the third closely watched company to issue a robust harvest outlook this week.
“Grain markets are moving lower with wheat prices down on ample world supply, while corn and soy face the prospect of the imminent start to the U.S. harvest,” said Paul Deane, senior agricultural economist at ANZ Bank.
— Mark Weinraub is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.
