SINGAPORE: Chicago corn and soybeans gained more ground on Wednesday with investors covering short positions ahead of a key US government crop outlook, although forecasts of cool and wet weather curbed gains.
Wheat slid as dismal demand for US supplies kept a lid on prices.
“Weather in much of the US Midwest is favourable for crop development as there are forecasts of more rains and milder temperatures,” a Singapore-based trader said.
The most-active corn contract on the Chicago Board of Trade (CBOT) added 0.4% to $5.00-3/4 a bushel, as of 0312 GMT and soybeans gained 0.7% to $13.15-1/4 a bushel. Wheat fell 0.4% to $6.53-1/2 a bushel.
Forecasts of cool temperatures and rainy conditions across much of the US Midwest during the next week will boost prospects for both crops.
The US corn harvest could be the second-largest on record as rains during July shepherded the crop through its critical development phase, offsetting dry conditions early in the season and hot summer temperatures, analysts and farmers said.
A strong harvest would add to domestic stockpiles that are expected to balloon as demand for US corn exports wilts due to a massive harvest in Brazil, which is expected to overtake the US as the world’s top corn supplier.
Analysts expect the US government in a monthly report due on Friday to cut its forecast for domestic corn production to 15.135 billion bushels this year, from its July estimate for a record 15.320 billion bushels.
The lack of demand for US supplies continues to weigh on Chicago futures.
China corn futures up for the fourth day
Egypt’s state grains buyer, the General Authority for Supply Commodities, said on Tuesday it bought 235,000 metric tons of Russian wheat in an international tender.
Dozens of ships are backed up around critical Danube arteries close to Ukraine’s river gateways, days after Russian drone attacks on the country’s ports, shipping data showed on Tuesday.
China’s July soybean imports jumped by almost one-quarter from a year ago, official data showed, boosted by improved demand in the world’s biggest buyer, especially for use in animal feed, and by higher arrivals from Brazil.
China imported 9.73 million metric tons of soybeans in July, up 23.5% from a year ago, customs data showed on Tuesday.
Commodity funds were net buyers of CBOT corn, soybean, soymeal and soyoil futures contracts on Tuesday and net sellers of wheat futures, traders said.