US corn and soyabeans futures fell more than 1 percent to their lowest levels in four years on Thursday in a technical selloff sparked by the looming harvest of record-large crops. Wheat futures also were mostly lower, with several contracts reaching lifetime lows for a second straight session. The dollar climbed to its highest point in more than a year against a basket of other currencies, further weighing on US grains as importers could more cheaply source supplies priced in other currencies.
"The corn action more than anything else is technical," said analyst Roy Huckabay of the Linn Group grain brokerage in Chicago. "We've gone sideways for two months, and when we broke out of that trading range, it created a pretty heavy round of technical selling."
Corn on Wednesday broke through the most recent lows, notched on August 12, to fall to the lowest point since June 2010 on a continuous chart after the US Agriculture Department unexpectedly boosted good-to-excellent conditions ratings for the US corn and soyabean crops.
After the USDA announcement late on Tuesday, several private analysts lifted their own crop estimates beyond already record forecasts for the corn and soya harvests. "Technically, getting below $3.60 (per bushel of corn) opens the door to $3.35," Huckabay said. Most-active Chicago Board of Trade December corn finished 5-1/2 cents, or 1.6 percent, lower at $3.46-1/2 per bushel after hitting a contract low of $3.43-3/4.
Soyabeans for November delivery fell 16-3/4 cents to $10.03-1/4 per bushel. On a continuous chart for the most-active soya contract, prices declined to as low as $10.01-1/4 - the lowest point since September 1, 2010. Investors were pricing in a larger crop on expectations that the USDA will increase its own outlook in the next monthly supply and demand report, due on September 11.
"There is a large crop coming our way in the US, and conditions have been favorable," said Graydon Chong, senior grains analyst at Rabobank. "From our perspective, we expect some upward revisions in the USDA corn forecast." Crop forecaster Lanworth on Wednesday lowered its forecast for the US 2014 corn yield, but its production projection was still higher than the USDA. Research advisory firm Allendale Inc said on Wednesday it forecast the 2014 US corn crop at 14.409 billion bushels, above the government's latest estimates. CBOT December wheat settled 5-1/2 cents lower at $5.30 after hitting a contract low of $5.27-1/2 earlier in the day.
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