U.S. grains: Corn extends slide on crop prospects

Chicago | Reuters –– Chicago corn futures fell for a third straight session on Wednesday, setting life-of-contract lows as improving crop ratings and benign weather forecasts raised confidence in U.S. harvest prospects, traders said.

Wheat rose, with benchmark Chicago wheat rebounding from a three-month low set a day earlier and K.C. and Minneapolis hard wheat futures bouncing from multi-year lows.

Soybean futures firmed on news of fresh U.S. export sales to Mexico while advances in crude oil and Wall Street equity markets added support.

Chicago Board of Trade December corn settled down 2-1/2 cents at $3.58-1/2 per bushel after dipping to a contract low at $3.56-1/2 (all figures US$).

CBOT December wheat ended up 7-1/4 cents at $4.60-3/4 a bushel and November soybeans rose seven cents to settle at $8.75-1/2 a bushel.

Corn extended its slide after the U.S. Department of Agriculture late Tuesday rated 58 per cent of the U.S. corn crop in good-to-excellent condition, up from 57 per cent the previous week, in line with trade expectations.

The crop’s development is behind normal following widespread spring planting delays, but forecasts call for seasonal temperatures throughout September that should prolong the Midwest growing season, raising the odds that crops will have time to mature.

“The trade looks at the 16-to-30-day (weather forecast) maps and sees no frost-freeze. That was enough to get weak longs out of the market,” said Don Roose, president of Iowa-based U.S. Commodities.

After the CBOT close, commodity brokerage INTL FCStone raised its estimate of the average U.S. 2019 corn yield to 168.4 bushels per acre, from 167.4 in its previous monthly report released on Aug. 1.

Wheat futures advanced on short covering and a weaker U.S. dollar, which makes U.S. grains more competitive on the global export market. The dollar fell as risk sentiment improved amid easing global political worries.

Front-month K.C. hard red winter wheat rallied from a 14-year low set Tuesday while Minneapolis Grain Exchange spring wheat futures bounced from a 10-year low. Plentiful harvests have pressured wheat prices globally as suppliers vie for export business in a crowded market.

Paris wheat futures have slipped to their lowest levels in over a year.

“The EU is looking forward to significantly higher exports in 2019-20 than in the previous year,” Commerzbank analysts wrote. “At the same time, there is considerable competition from the Black Sea region again.”

Soybean futures drew support from USDA’s confirmation that private exporters sold 451,766 tonnes of U.S. soybeans to Mexico.

Soybeans also firmed as the drop in the dollar and gains across commodity and equity markets lent support.

Soybean investors continued to seek fresh indications on U.S.-Chinese discussions to resolve a trade dispute that has stalled U.S. soybean exports.

— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.