SINGAPORE: Chicago soybean futures lost ground on Monday, while corn prices were little changed, with both markets weighed down by a US government forecast for all-time high production.
Winter wheat climbed almost 1%, adding to last session’s strong gains as expectations of crop losses in the drought-stricken US Plains underpinned prices.
“The USDA monthly supply/demand report on Friday presented the first look at the 2023/24 season and it was bearish for corn and soybeans,” commodities research firm Hightower said in a report.
“Big ending stocks are anticipated if the weather is normal.”
The most-active corn contract on the Chicago Board of Trade (CBOT) added quarter of a cent to $5.86-1/2 a bushel, as of 0120 GMT and soybeans lost 0.1% to $13.88-3/4 a bushel.
K.C. hard red winter wheat futures rose 0.9% to $8.84-3/4 a bushel, after climbing 4.2% on Friday.
The US Department of Agriculture (USDA) in its monthly supply-demand report said wheat harvest in the Plains would be the smallest since 1957 as farmers across Kansas, Oklahoma and Texas were forced to abandon crops due to dry conditions.
Global wheat importers and exporters are keeping a close watch on talks to extend a Black Sea grain pact that allows Ukraine to ship grains despite war with Russia.
Parties to the Black Sea grain pact are nearing a deal to extend it after talks between Ukrainian, Russian, Turkish and United Nations officials, Turkey’s Defence Minister Hulusi Akar said.
Russia has threatened to quit the agreement on May 18 over obstacles to its grain and fertilizer exports and the four parties discussed UN proposals to extend the deal on Thursday.
Soybeans face pressure on US planting weather, tepid China demand
US corn and soybean supplies were expected to rise sharply in the coming year due to forecasts for a record harvest for both crops, the USDA said on Friday.
Ending stocks of corn for the 2023/24 marketing year were pegged at 2.222 billion bushels, up from 1.417 billion in 2022/23. Soybean end stocks were forecast to grow to 335 million bushels from 215 million with wheat stocks seen falling to 556 million bushels, their lowest since 2008.
However, corn and soybean production forecasts will be highly dependent on US Midwest weather over the next several months, which will be a key market concern as farmers finish planting and crops.
China is significantly increasing the rate of inspections on imported soybean cargoes, three soybean traders told Reuters on Friday, lengthening already slow and costly clearing times in the world’s top buyer of beans.
Large speculators trimmed their net short position in CBOT corn futures in the week to May 9, regulatory data released on Friday showed.
The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that noncommercial traders, a category that includes hedge funds, trimmed their net short position in CBOT wheat and cut their net long position in soybeans.