U.S. grains: Corn, soy, wheat fall after USDA report

(USDA.gov via Flickr)

Chicago | Reuters — Chicago Board of Trade corn futures fell more than two per cent on Wednesday, the most in a month, while soybean and wheat futures also declined on expectations for record-large U.S. harvests and huge grain inventories.

At the CBOT, December corn settled down 8-1/2 cents at $3.37 per bushel. November soybeans ended down 8-3/4 cents at $9.45-1/2 a bushel and December wheat fell 10-1/2 cents at $3.96-3/4 a bushel.

Corn posted the biggest percentage declines on chart-based selling. The U.S. Department of Agriculture lowered its estimate of the U.S. 2016 corn yield to 173.4 bushels per acre, from 174.4 in September, but still the highest on record, if realized.

And while USDA trimmed its forecast of the amount of U.S. corn left over at the end of the 2016-17 marketing year, its figure of 2.32 billion bushels would still be the largest in 29 years, if realized.

Trade in CBOT December corn was volatile for the first 15 minutes after USDA released its report, but the contract then sagged for the rest of the session, dipping to its lowest since Oct. 3.

On soybeans, USDA raised its U.S. yield estimate to a record-high 51.4 bu./ac. The figure was roughly in line with analyst expectations, but could rise in next month’s report.

“I think November will hold another increase. Even with late rains, this crop is incredible and (we) may see higher yields before we’re done,” said Alex Norton, an analyst with Beeson Inc.

USDA raised its forecast of U.S. 2016-17 soybean ending stocks to 395 million bushels, from 365 million in September, and up from 197 million bushels at the end of 2015-16.

“We rallied early as the bean yield was not as big as the ‘whisper’ number, but all told, it was hard to fundamentally justify bean prices higher than a year ago, when the carry-out domestically was projected to double,” ED+F Man Capital analyst Charlie Sernatinger wrote in a note to clients.

Wheat futures followed the lower trend. USDA raised its forecast of U.S. wheat ending stocks to 1.138 billion bushels, the most since 1987-88 marketing year, if realized.

USDA pegged global 2016-17 wheat ending stocks at 248.37 million tonnes, down from last month but still an all-time high.

After the CBOT close, Egypt’s General Authority for Supply Commodities (GASC) set an international tender to buy an unspecified amount of wheat for Nov. 11-20.

Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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