Reuters — U.S. soybeans and grains dipped on Wednesday, weighed down by abundant harvest prospects in key countries.
Soybeans led the way lower, as the closely watched four-day Pro Farmer U.S. Midwest Crop Tour scouted impressive crops in central Illinois, following its observation a day earlier of above-average soybean pod counts in Nebraska and Indiana.
Southwestern Iowa’s soybean crop potential, however, looked below average.
U.S. soybeans benefit from strong demand, due to production shortfalls in South America, “but we’re still going to have a big crop,” said Bill Gary, president of Commodity Information Systems in Oklahoma City.
Most-active November soybean futures on the Chicago Board of Trade dropped 8-1/4 cents, or 0.9 per cent, to $10.05-1/4 a bushel (all figures US$).
Corn’s losses were more modest, as tour results looked mixed.
Corn in southwestern Iowa showed above average yield potential but lagged behind the U.S. government’s record projection for the country’s top corn producing state, scouts found on Wednesday. Central Illinois cornfields also looked impressive, but may yield less than the record-large hauls of the past few years.
Earlier, Nebraska corn yields measured lower year over year, while in Indiana, yields looked higher, but fell short of U.S. Department of Agriculture estimates from Aug. 12.
“Tour participants are increasingly becoming convinced that the corn crop, based on the first two days, is smaller than USDA’s August estimate — likely significantly lower in their opinion,” said Arlan Suderman, chief commodities economist at INTL FCStone.
“Keep in mind that I believe that USDA’s corn demand estimates are likely inflated by 300 million bushels. With that in mind, a smaller corn crop is not likely to turn the balance sheet bullish, but rather less bearish.”
Corn was further underpinned by a USDA report that said private exporters sold 101,600 tonnes of U.S. corn to unknown destinations for 2016-17 delivery.
Most-active December corn futures lost one cent, or 0.2 per cent, to $3.36-1/4. Prices earlier hit a low of $3.34-1/2 a bushel, the weakest since Aug. 16.
Wheat is under pressure from expectations for Canada’s second-largest wheat crop in 25 years, and a raised estimate for Ukrainian production.
“We’ve got unbelievable amounts of grain in the world,” Gary said. “I don’t know what we’re going to do with all this grain.”
Most-active Chicago December wheat futures dropped 1-1/4 cents or 0.2 percent at $4.26-1/4 a bushel, after touching $4.23-1/4 in earlier trade, the lowest since Aug. 17.
— Rod Nickel is a Reuters correspondent covering the agriculture and mining sectors from Winnipeg. Additional reporting for Reuters by Julie Ingwersen in Chicago, Colin Packham in Sydney and Sybille de La Hamaide in Paris.