Chicago | Reuters — Chicago Board of Trade wheat futures weakened on Friday and posted their biggest weekly decline in six months as ample supplies from the Black Sea region weighed on prices, analysts said.
Soybean and soymeal futures rallied amid increasing concerns about drought hurting crops in Argentina, the world’s leading exporter of processed soybean oil and meal. Soybeans were also oversold following losses earlier this week, analysts said.
“The weather maps this morning had taken out some of the rain that was forecasted previously for Argentina next week,” said Terry Linn, analyst with Linn and Associates in Chicago. “Beans and meal are leading the way, being super-responsive to that.”
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The most-active CBOT wheat contract ended down 3-1/4 cents at $7.43-1/2 bushel (all figures US$). For the week, wheat lost six per cent, its biggest drop since July.
Most-active soybeans rose 21-3/4 cents to $14.92-1/2 a bushel and ended down two per cent for the week. Corn rose 1-1/4 cents to $6.54 a bushel and lost 3.6 per cent for the week.
“We started out the week where we had three days of hard selling across the grain complex in general, including the beans,” Linn said. “That type of structured selling does not appear to be around the market today.”
Poor crop weather in Argentina should support corn futures prices from $6.40 to $6.50 a bushel, said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage.
“The dry weather in Argentina is an ongoing concern and will be a supportive factor until there is a change in the weather pattern,” he said.
For wheat, the availability of abundant low-priced supplies from Russia and Ukraine are giving stiff competition to other global exporters, traders said. Reports of a record crop expected in Australia, the world’s second-largest exporter of the grain, also weighed on prices.
“The wheat market appears to be amply supplied in the short term,” Commerzbank said in a note.
Next week, the U.S. Department of Agriculture is slated to issue quarterly grains stocks and monthly supply/demand data on Jan. 12.
— Reporting by Tom Polansek and Julie Ingwersen in Chicago; additional reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.
