New-crop US soyabean futures hit a new contract low on Wednesday and corn matched its contract low ahead of the release of US crop reports that are expected to show a rise in the government's harvest projections. Wheat also notched a contract low, weighed down by plentiful global supplies.
Prices for new-crop corn and soyabeans edged higher from their lows as traders bought back previously sold positions before the US Department of Agriculture issues monthly supply/demand and production data on Thursday. However, nearby futures for both crops remained near four-year lows reached last week due to expectations that massive harvests will replenish inventories.
"The potential for a large crop and a bearish supply/demand report tomorrow gives the bulls little reason to buy corn in any big way," said Tomm Pfitzenmaier, analyst at Summit Commodity Brokerage in Iowa. Most-active Chicago Board of Trade December corn, which represents the autumn harvest, ended up 0.4 percent at $3.45-3/4 a bushel after matching Tuesday's contract low of $3.43 in earlier trading. Nearby September corn advanced 0.7 percent to $3.38-3/4 a bushel, near a four-year low of $3.33-1/4 reached on September 4.
New-crop November soyabeans gained 0.1 percent to $9.93-3/4 a bushel after setting a contract low of $9.90 in earlier trading. September soyabeans dipped 0.5 percent to $10.71 a bushel, above a four-year low of $10.64 reached on September 4. The USDA is expected to raise its estimate for US corn production to 14.288 billion bushels on Thursday, from its August estimate of 14.032 billion, according to a Reuters poll of analysts. The government's estimate for soyabean production is seen at 3.883 billion bushels, up from 3.816 billion last month.
"Currently the question for the market is to find out how large or record large the US harvests will be, especially for soyabeans," said Ole Hansen, head of commodity strategy at Saxo Bank. CBOT December wheat closed down 1.5 percent at $5.19-3/4 a bushel after setting a new contract low of $5.19-1/4. Commodity funds sold an estimated 5,000 wheat contracts, bought 3,000 corn contracts and were net even in soyabeans, traders said. Traders are "justifiably fearful" the USDA will hike its estimate for global wheat production on Thursday, said Rich Feltes, vice president of research for brokerage R.J. O'Brien.
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