US corn futures hit a three-week low early on Monday, falling for a third straight session as sluggish exports and an expected upward revision to US stocks suggested a recovery in supply after a drought-hit harvest. Wheat followed corn down, pressured by technical selling, while nearby soyabeans were lower in choppy trade.
At the Chicago Board of Trade as of 10:45 am CST (1645 GMT), CBOT March corn was down 5-3/4 cents at $7.31-1/2 per bushel. March wheat was down 11 cents at $8.50 a bushel and January soyabeans were down 5 cents at $14.67-1/4 a bushel. Traders noted long liquidation in corn and wheat a day ahead of the US Department of Agriculture's monthly supply/demand reports. Analysts expect USDA on Tuesday to raise its forecast of US corn ending stocks for 2012/13 due to poor export demand. Severe drought in the heart of the US Corn Belt this summer contributed to the spread of aflatoxin, the toxic by-product of a mold that tends to spread in corn in drought years.
Wheat fell as technical selling and caution ahead of Tuesday's USDA crop report outweighed support from fresh export demand and adverse weather in the US and Argentina. At the CBOT, the most-active March contract fell below chart support at $8.51-1/2, a level that had held for four straight sessions last week. The contract dipped to an intra-day low of $8.46-3/4, its lowest level in three weeks.
On the export front, Saudi Arabia bought 295,000 tonnes of hard wheat from the European Union, Australia and the United States, while Iraq bought 350,000 tonnes of wheat from Australia and Romania. Argentina will allow only 4.5 million tonnes of wheat exports this campaign, against 6 million previously planned, in response to a rain-plagued harvest, a local newspaper reported. USDA confirmed that private exporters sold 115,000 tonnes of US wheat to Egypt, including 60,000 tonnes of soft red winter wheat and 55,000 tonnes of soft white wheat, but some traders said the market had already factored in the news.