Chicago | Reuters — U.S. wheat futures dropped to a four-month low on Monday while corn and soybeans hovered near multi-month lows as large crop inventories kept a lid on prices.
Traders focused on hefty grain supplies as crop weather improved in South America, with scattered showers in Brazil easing concerns about drought curtailing soybean yields. Farmers in South America are advancing the soybean harvest, increasing competition for export business, analysts said.
In Canada, stockpiles of wheat and canola at the end of 2014 were thought to be among the biggest in recent decades, according to a Reuters survey of traders and analysts before the release of a Statistics Canada report on Wednesday.
“We’re still in a supply bear market,” said Don Roose, president of U.S. Commodities in Iowa.
Chicago Board of Trade (CBOT) March wheat ended down 10 cents at $4.92-3/4 after touching a session low of $4.92-1/4, its lowest price since Oct. 10 (all figures US$).
On Tuesday, wheat traders will be waiting for the results of an import tender from Egypt, the world’s top importer of the grain.
A major snowstorm over the weekend dumped more than a foot of snow on the U.S. Midwest’s wheat areas, providing a protective cover for the dormant crop. The deep snowfall also will slow the movement of grain early this week, traders said.
“Lower prices are certainly not going to entice anyone to go out into the cold snowy weather and move corn,” said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage in Iowa.
March soybeans slipped 1-1/2 cents to $9.59-1/2 a bushel. On Friday, the contract fell to $9.55, its lowest since Oct. 21. March corn ended nearly flat at $3.69-3/4 a bushel, near a two-month low of $3.65-3/4 a bushel reached during the previous trading session.
Private exporters reported sales of 132,600 tonnes of U.S. corn to Mexico, including 121,550 tonnes for delivery in 2014-15 and 11,050 tonnes for 2015-16, the U.S. Agriculture Department said on Monday. The marketing year for corn begins on Sept. 1.
— Tom Polansek reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.