Chicago | Reuters — U.S. corn fell on Wednesday, snapping four sessions of gains, as the stockpile of grain-based ethanol hit a nine-month high and meteorologists forecast more favourable conditions for U.S. plantings.
Soybean futures also eased, while wheat reversed earlier declines to notch the seventh straight session without a loss at the Chicago Board of Trade. End-of-the-month profit-taking weighed on each contract, while commercial traders also squared positions on the first notice day for deliveries against May futures contracts.
“The weather is going to be a little better. You are seeing some additional selling in the new crop because maybe we’ll get all the corn planted after all,” said Jack Scoville, analyst at brokerage the Price Futures Group in Chicago.
Warmer and drier conditions were forecast beginning this weekend in the southern and central U.S. Corn Belt, which should provide farmers an opportunity to catch up on spring seedings that were off to a slow start, the Commodity Weather Group said in a note to clients.
Corn futures on Tuesday settled at the highest levels since August as excessive rain delayed planting in the U.S. Midwest before prices hit their session lows early on Wednesday following a U.S. Energy Information Administration report showing the ethanol stockpile at the largest level since July.
Most-active CBOT July corn finished 2-1/2 cents lower at $5.19 per bushel, while new-crop December fell three cents to $5.09 (all figures US$). Corn futures on a continuous chart gained two per cent for the month for the fifth straight monthly gain.
CBOT July soybeans fell 4-1/2 cents to $15.12-3/4, while soy on a continuous chart climbed two per cent during April.
“There is a risk-off approach today including soybeans as the market assesses the impact of U.S. weather,” a European trader said.
Wheat futures continued to bound higher on worries that cold and drought conditions in the southern U.S. Plains would reduce yields for the hard red winter wheat crop.
CBOT July wheat was up five cents at $7.21-1/2 per bushel, the highest since March 20. Kansas City Board of Trade July wheat jumped 10 cents to $8.13, the highest price in about 11 months. Wheat was about 0.9 per cent higher for the month for the second straight monthly gain.
An annual crop tour in the top-growing state of Kansas was in its second day after scouts on Tuesday estimated the poorest prospects in 13 years for wheat fields in the northern part of the state.
In the southwest part of the state, crops needed rain soon, the scouts found.
“The poorer fields are not going to bounce back. They will be half of what they are today if we don’t get rain in the next 10 days,” said Darwin Ediger, a producer near Meade, Kansas, and president of the Kansas Crop Improvement Association.
Crop scouts on the first day of the annual three-day tour of Kansas projected an average yield for hard red winter wheat in the northern portion of the state at 34.7 bushels per acre, down from 43.8 bushels a year ago.
The tour’s five-year average for the same area is also 43.8 bushels per acre.
— Michael Hirtzer reports on agriculture and commodity markets for Reuters from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Naveen Thukral in Singapore.