Chicago | Reuters — U.S. corn and soybean futures fell to six-month lows on Thursday as another rout on Wall Street underscored uncertainty about economic fallout from the coronavirus pandemic as well as demand for agricultural commodities, analysts said.
Wheat futures followed the weak trend.
Chicago Board of Trade May corn settled down 8-3/4 cents at $3.65-3/4 per bushel after hitting a life-of-contract low at $3.65, the cheapest price for a most-active corn futures contract on a continuous chart since Sept. 12 (all figures US$).
CBOT May soybeans ended down 13-3/4 cents at $8.59-1/2 a bushel after recording a contract low at $8.52-1/4, which was also the lowest price for a most-active soybean contract since Sept. 9.
CBOT May wheat fell 7-1/4 cents to settle at $5.05-1/2 a bushel, paring losses after touching $4.97-1/4, the contract’s lowest level since Sept. 30.
“The ags are being pulled under along with the rest of the broader markets. Fear shows no partiality,” INTL FCStone chief commodities economist Arlan Suderman wrote in a note to clients.
The Dow Jones index recorded its worst performance since Wall Street’s “Black Monday” crash of 1987 after new travel restrictions to curb the coronavirus spread spooked investors and rattled world markets.
Fear gripped the commodity markets as well.
“People I deal with on the buy side, whether it’s importer or end-user, they are worried about health uncertainty. What does it mean for their demand and their companies? So they are scaling back purchases or pulling orders,” said Dan Basse, president of Chicago-based AgResource Co.
“At the moment, what we are really lacking is buyers to turn things around amid the uncertainty,” Basse said.
Traders shrugged off bullish corn export data from the U.S. Department of Agriculture. The government reported export sales of old-crop corn in the week to March 5 at nearly 1.5 million tonnes, above analyst expectations.
Soybean export sales fell below expectations, and weekly net cancellations of U.S. pork sales to China topped 45,000 tonnes, the most in records dating to 2013.
CBOT wheat drew underlying support from a higher close in Paris wheat futures and news that Algeria’s state grains agency bought around 680,000 tonnes of milling wheat in an international tender, European traders said. The grain was expected to be sourced from France.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.