Chicago | Reuters — U.S. wheat futures slid on Monday, giving back some of the strong gains made in the previous two sessions as fears of potential supply disruptions from the Black Sea region eased.
New-crop corn futures dropped as a private U.S. crop tour reported large yield potential, while soybeans inched higher.
Tensions between Russia and Ukraine influence the grain markets because the countries are major exporters of wheat and corn. Their conflict was viewed as less heated following talks among Russia, Germany, France and Ukraine on Sunday.
“We went home Friday thinking the Ukrainians and Russians would be at each other’s throats today,” said Jim Gerlach, president of A/C Trading. “It looks like they de-escalated a bit over the weekend.”
Chicago Board of Trade December wheat lost 1.6 per cent to $5.54-1/4 a bushel, after climbing more than four per cent in the previous two sessions (all figures US$).
December corn dropped 1.5 per cent to $3.71-1/2 a bushel after rising on Friday to a nearly one-month high of $3.79-3/4 a bushel. November soybeans rose 0.5 percent to $10.57-3/4 a bushel.
Commodity funds sold an estimated 4,000 wheat contracts and 6,000 corn contracts, and bought 2,000 soybean contracts.
Corn came under pressure as participants on the first day of the Pro Farmer Midwest Crop Tour found farmers have the potential for big corn and soybean yields in southwestern Ohio and east-central Indiana.
About 130 crop scouts will participate in the tour, which began surveying fields on Monday, and are expected to find a bigger average yield than the U.S. Department of Agriculture estimated in a report last week.
Analysts predicted USDA, in a weekly report due at 3 p.m. CT on Monday, would keep corn and soy condition ratings steady or cut them slightly due to dryness.
However, recent U.S. rains have reduced concerns about dry crops areas, boosting yield potential, Gerlach said. Projections for record-large U.S. corn and soy harvests should pressure crop prices, after corn futures last week posted their biggest weekly gain in five months, he said.
“Ultimately this little bounce we had is going to fizzle out,” Gerlach said.
— Tom Polansek reports on ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Sarah McFarlane in London.