U.S. grains: Corn inches higher on weather uncertainty

Chicago soybean futures sag

(Photo courtesy Water Management Research Unit, ARS/USDA)

Chicago | Reuters — U.S. corn futures firmed on Friday on light short-covering ahead of the weekend and uncertainty about planting weather in the Midwest, analysts said, while soybeans and wheat closed modestly lower.

Chicago Board of Trade July corn settled up 1-3/4 cents at $3.71 per bushel (all figures US$). July soybeans ended down 3-1/4 cents at $9.63 a bushel after dipping to $9.60-1/2, the contract’s lowest since May 1.

CBOT July wheat fell one cent at $4.32-3/4 a bushel.

Corn rose as some forecasts added moisture for next week. U.S. farmers are trying to finish planting following rain delays in recent weeks and flooding in portions of the southern Midwest.

“We’ve got stuff that needs to be re-planted and stuff that hasn’t been planted yet. And we’ve got a forecast that is starting to get a little bit more intimidating,” said Bill Gentry, a broker at Risk Management Commodities in Lafayette, Indiana.

Funds hold a large net short position in CBOT corn futures, leaving the market vulnerable to bouts of short-covering.

Also supportive, private analytics firm Informa Economics lowered its projection of U.S. 2017 corn plantings to 89.7 million acres, trade sources said, below the U.S. Department of Agriculture’s March 31 figure of 90 million acres.

Informa raised its forecast of U.S. 2017 soybean plantings to 89.662 million acres, above the USDA’s March figure of 89.5 million acres.

Along with the larger Informa soy acreage figure, CBOT soybeans were pressured by rising estimates of South America’s harvest. Brazil’s statistics agency Conab on Thursday raised its estimate of the country’s 2016-17 crop to a record of 113 million tonnes, from 110.2 million last month.

Wheat ended lower after a choppy session, anchored by plentiful global supplies. But the market drew underlying support from excessive moisture in the U.S. Plains and Midwest that has threatened winter wheat production potential.

“We’ve got the reduced acres, the smallest in a hundred years. And on top of it, we’ve got a crop size that we really don’t know, given all the snow and damage they’ve got,” Gentry said.

“The funds don’t need to crowd the short side anymore.”

After the CBOT close, weekly data from the U.S. Commodity Futures Trading Commission showed large speculators trimmed their net short position in CBOT wheat by about 14,000 contracts in the week to May 9, to 136,814 contracts.

— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Naveen Thukral in Singapore and Gus Trompiz in Paris.

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