US wheat, corn and soyabeans fell again on Tuesday in the wake of falling equity and crude oil markets as investors sought low-risk assets, but falls were restrained by firm grain fundamental data. European and Asian stock markets nose-dived, gold rose and the Swiss franc touched record highs as investors sought safe havens in a global rout triggered by fears political leaders are failing to tackle debt crises in Europe and the United States.
"Grains and oilseeds are again being pushed down by falling outside markets but the falls are less than being seen in other sectors such as energy because the fundamental data for grains is still supportive," said Commerzbank analyst Carsten Fritsch.
Chicago September wheat fell 0.2 percent to $6.55 a bushel at 1102 GMT but had been in positive territory at the end of Asian trade. Wheat has now lost over a quarter of its value since its peak on February 9. Chicago Board of Trade actively traded November soyabeans were down 0.2 percent at 13.08 a bushel, after touching $12.82 a bushel, the lowest since March 17. Chicago December corn fell 0.4 percent to $6.83 a bushel after touching $6.76-3/4 a bushel, the lowest since August 1.
European benchmark wheat futures in Paris also fell, with November down 0.6 percent at 189.00 euros a tonne. "The fundamental data for grains is still supporting and this is preventing harder falls," said Fritsch. "There are tight inventories and risks to crops in Europe to wheat from rain and to corn from heat in the US." Kazuhiko Saito, chief commodities analyst at Tokyo-based trading company Fujitomi, said the US Department of Agriculture will release its demand-supply report on Thursday which many market participants expect to be bullish, but the immediate focus will remain on falling equity and commodity markets.
Saito said his target price for December corn was below $6 a bushel and November soya around $12 a bushel at the end of this week as the panic selloff continues. In wheat, low prices appeared to be stimulating import demand with Egypt tendering yet again for wheat after making a major purchase last week.
Strong fundamentals for corn focused on news the condition of the US corn crop declined more than expected last week, stressed by hot and dry weather as it starts the crucial pollination phase. The US Agriculture Department had on Monday rated the corn crop at 60 percent good to excellent as of Sunday, down 2 percentage points from a week earlier and down from 71 percent a year ago.
The USDA will release its updated crop production and ending stocks estimates on Thursday in its August crop reports. The United States is likely to produce its second-largest corn crop this year, a Reuters Poll says, but the forecast is smaller than the record harvest seen just last month due to damage from rains and high heat.
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