Chicago | Reuters — U.S. wheat futures fell more than two per cent on Monday on improving weather forecasts for the southern Plains winter wheat belt, analysts said.
Corn followed wheat down and nearby soybean futures closed fractionally lower after a choppy session.
Chicago Board of Trade May wheat settled down 10 cents at $4.30-1/2 per bushel after touching $4.30, its lowest since Feb. 1 (all figures US$). CBOT May corn ended down 3-1/4 cents at $3.61 a bushel and May soybeans fell 1/2 cent at $10.06 a bushel.
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Wheat was the biggest mover on a percentage basis. The Commodity Weather Group said updated forecasts raised the likelihood of much-needed rain in the southern Plains in the 11- to 15-day period, although showers could miss some dry areas.
Moisture would boost U.S. production prospects at a time when global and domestic wheat supplies from last year remain burdensome.
“This is what grain markets do when they get a little bit of good weather, against a backdrop of adequate old-crop stocks,” said Rich Feltes, vice-president for research with R.J. O’Brien.
The sell-off in wheat dragged down corn, which posted a sixth consecutive lower close despite strong weekly U.S. export data. May corn dipped to $3.60-1/2, its lowest since Jan. 12.
The U.S. Department of Agriculture reported export inspections of U.S. corn in the latest week at 1,547,022 tonnes, at the high end of a range of trade expectations.
However, a big South American corn harvest is expected.
“Prices are lower because supplies remain ample and the trade expects that a 90-plus million-metric tonne Brazilian (corn) crop will significantly curtail export demand in the latter half of this year,” INTL FCStone chief commodities economist Arlan Suderman wrote in a note to clients.
Private analytics firm Informa Economics raised its projection of U.S. 2017 corn plantings to 90.8 million acres, from its January forecast of 90.5 million, trade sources said. The firm raised its soybean plantings forecast to 88.7 million acres, up about 21,000 acres from January.
CBOT soybean futures were consolidating after the May contract set a two-month low last week at $10.03 a bushel, pressed by forecasts for a record-large Brazilian soy harvest.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.
