Reuters — Chicago soybean futures slid for a third consecutive session on Thursday, giving up three per cent to their lowest since mid-August, as a widely watched crop tour reported bumper prospects across the U.S. Midwest.
Corn and wheat lost ground for a fourth session in a row, amid expectations for huge global grain supplies.
The annual four-day Pro Farmer Midwest Crop Tour observed on Thursday soybean crop prospects in southern Minnesota that were above average, and in line with last year. Soybean potential in eastern Iowa looked on par with recent years.
Late on Wednesday, the tour reported above-average soybean pod counts in Illinois and the western portion of Iowa.
“I think the beans have a long way to go on the downside,” said Bill Biedermann, manager of Allendale Inc.’s Crystal Lake, Illinois brokerage branch. “You’ve got fundamentals, technicals and bigger picture stuff all saying that unless something crazy happens, (lower) is the path of least resistance.”
Soybeans are trading at a price about three times greater than corn, higher than the traditional ratio that is a key pricing benchmark, Biedermann said. Domestic and export demand for soybeans may fall short of U.S. Department of Agriculture projections, and yields look to be growing, he added.
The Chicago Board of Trade most-active soybean contract lost 29-3/4 cents or three per cent at $9.75-1/2, touching its lowest price since Aug. 12 (all figures US$). Technical selling added to the drop.
“Soybean prices had been pushed higher because of Chinese demand for U.S. shipments, but the supply picture is very favourable,” said Phin Ziebell, agribusiness economist at National Australia Bank.
Corn dropped 4-1/4 cents, or 1.2 per cent, to $3.32 per bushel, while Chicago wheat gave up 2-1/2 cents or 0.6 per cent at $4.23-3/4, dragged lower by soybeans’ plunge.
The International Grains Council on Thursday raised its forecasts for world corn and wheat production in the 2016-17 season to record highs.
The Pro Farmer tour on Wednesday projected Illinois’ corn yield potential sharply higher than last year but below USDA’s record-large forecast. Corn yields in western and eastern Iowa looked bigger than last year.
In southern Minnesota, however, corn yield potential seemed weaker than last year, as crops were stressed by excessive moisture and hot nights this summer, scouts found.
Export demand limited corn’s losses. USDA reported weekly export sales of 71,100 tonnes of old-crop corn, below trade expectations, and 1,059,900 tonnes of new-crop corn, above expectations.
— Rod Nickel is a Reuters correspondent covering the agriculture and mining sectors from Winnipeg. Additional reporting for Reuters by Julie Ingwersen in Chicago, Sybille de La Hamaide in Paris and Naveen Thukral in Singapore.