Chicago | Reuters — U.S. wheat futures rebounded on Wednesday, after a government report showed that wheat production was less than traders had expected.
Meanwhile, corn futures lost ground, after the U.S. Department of Agriculture’s quarterly grain stocks report showed that both corn and soybean supplies were plentiful and U.S. farmers are harvesting what is expected to be yet another bumper crop for both.
Soybeans futures closed higher after a choppy session, supported by a smaller-than-expected US domestic stocks figure.
“You had the best report in the wheat, thanks to the wheat production number finally falling,” said Mike Zuzolo, president of Global Commodity Analytics, adding, “Wheat should garner most of the support, as long as the dollar remains contained.”
USDA reported on Wednesday that wheat production totaled 2.052 billion bushels, below the average trade estimate of 2.133 billion bushels. The agency also reported that production of spring wheat other than durum came in at 599 million bushels, below the average trade estimate of 625 million bushels.
USDA said that U.S. corn stocks as of Sept. 1 totaled 1.731 billion bushels, the biggest Sept. 1 figure in nine years. Soybean stocks, meanwhile, stood at 191 million bushels, a four-year high.
USDA also reported wheat stocks of 2.089 billion bushels as of Sept. 1, up from 1.907 billion bushels a year earlier.
Analysts on average had expected wheat stocks of 2.149 billion bushels. The corn and bean stocks were also slightly below expectations.
“That is one thing that is catching the trade off guard,” said Brian Hoops, president and senior market analyst of Midwest Marketing Solutions. “With the high ratings we had all year long, people thought we’d have this bigger crop and USDA did not confirm that.”
The news had Minneapolis spring wheat futures bouncing, said Hoops, who also noted that the bump in wheat helped pull up Chicago Board of Trade soybean futures off the day’s lows.
CBOT November soybeans closed up 7-3/4 cents, or one per cent, at $8.92 a bushel on Wednesday.
December corn closed down 1-1/4 cents, or 0.1 per cent, to $3.87-3/4 a bushel, while wheat closed up nine cents, or 1.9 per cent, at $5.12-3/4.
Plentiful global wheat supplies and strong export competition continued to hang over the wheat market, limiting rallies, while worries about dryness hampering winter wheat germination in the Black Sea region are lending underlying support.
— P.J. Huffstutter reports on agriculture and ag commodity markets for Reuters from Chicago. Additional reporting for Reuters by Sybille de La Hamaide in Paris, Naveen Thukral in Singapore and Julie Ingwersen in Chicago.