Chicago | Reuters — U.S. corn futures rose about two per cent on Wednesday after the U.S. Department of Agriculture’s forecast for global inventories at the end of the 2017-18 marketing year fell below trade expectations.
Soybean futures hit a six-week high after the USDA’s reports were released, buoyed by the government’s forecast for a smaller-than-expected rise in domestic ending stocks for 2017-18. But the market turned lower as traders shifted their attention to rising global inventories.
Wheat ended modestly higher.
Chicago Board of Trade July corn settled up 7-1/4 cents at $3.73-3/4 per bushel (all figures US$). CBOT July wheat finished up 2-1/4 cents at $4.31-3/4 a bushel.
Corn futures advanced after USDA’s first official supply and demand forecasts for the 2017-18 marketing year pegged world corn ending stocks at 195.27 million tonnes. The figure was down from 223.9 million expected at the end of 2016-17 and below an average of analyst estimates for 209.72 million.
“The corn is the winner coming out of this, on new-crop ending stocks in the world,” said Don Roose, president of Iowa-based U.S. Commodities.
USDA’s forecasts of domestic corn ending stocks for both 2016-17 and 2017-18 also came in below the average trade expectations.
In soybeans, the CBOT July contract settled down 3-3/4 cents at $9.70-1/4 a bushel, retreating after a post-report jump to $9.89, the highest level since March 27.
USDA projected U.S. 2017/18 soy ending stocks at 480 million bushels, well below the average pre-report trade estimate of 563 million. But on the global front, USDA raised its forecast of 2016-17 soy ending stocks to 90.1 million tonnes, topping even the highest figure in a range of trade estimates.
“The world supplies on beans bumped up to 90.1 million tonnes, 2.5 million over what it was a month ago. I think that put the kibosh on the beans a little bit,” said Mark Gold, analyst with Top Third Ag Marketing.
Wheat futures ended higher on fund short-covering and spillover strength from corn. USDA projected global wheat ending stocks in 2017-18 at 258.29 million tonnes, above a range of trade expectations.
The government forecast that U.S. wheat inventories would fall to 914 million bushels by the end of 2017-18, down from 1.159 billion at the end of 2016-17.
— Julie Ingwersen is a Reuters correspondent covering grain markets from Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Sybille de La Hamaide in Paris.Tagged cbot, closing markets, corn futures, soybean futures, USDA, wheat futures, world stocks