US corn prices set a nine-month low on Friday and posted their biggest weekly loss in 21 months on more selling in the wake of last week's US government report that showed larger-than-expected stockpiles of the grain. Soybeans fell to a 10-month low on fears of a potential drop in feed demand due to bird flu in China and seasonal pressure from the harvest of massive soya crops in South America.
Wheat rose on short-covering amid rumours of China buying US soft wheat. Wheat also drew support from a drop in the US dollar following disappointing US jobs data. A weaker dollar makes US wheat more competitive to holders of foreign currency. At the Chicago Board of Trade, corn settled 1 cent lower at $6.29 per bushel after falling to $6.26-1/2, the lowest spot corn price since June 25. For the week, the spot contract fell 66-1/4 cents, or 9.5 percent, the biggest weekly drop on a continuous chart since June 2011.
CBOT May wheat settled up 5 cents at $6.99 per bushel. Traders were watching to see whether the corn market had found bottom after dropping more than $1 a bushel, nearly 15 percent, since the US Department of Agriculture in a quarterly report last week showed larger-than-expected US stockpiles.
"We are still seeing follow-through selling from last week's report. It was really a bombshell, and there is a lot of length in corn in particular that still needs to exit," said Joe Vaclavik, president of Standard Grain in Chicago. After the CBOT close, data from the US Commodity Futures Trading Commission showed large speculators slashed their net long position in CBOT corn by 70 percent, the biggest weekly cut on record, in the week to April 2.
Front-month corn fell to new multi-month lows on four of five sessions this week, including Friday. The price break appeared to draw export business, with the USDA confirming sales of 120,000 tonnes of US corn to unknown destinations for delivery in the next marketing year. Soybean and soyameal futures fell on worries that bird flu might spread in China and reduce feed demand in the world's top soya importer.
CBOT May soyabeans ended down 10-1/4 cents at $13.61-3/4 a bushel, after falling to $13.54-1/2, the lowest spot soyabean price since June 6. Spot soyameal futures also hit a 10-month low. Chinese authorities slaughtered more than 20,000 birds at a poultry market in Shanghai on Friday as the human death toll from a new strain of bird flu mounted to six, spreading concern overseas.
Seasonal pressure from the soya harvest in Brazil and Argentina further pressured prices, although rains stalled the harvest in Argentina's south and central grain belt over the past week. "You have got a record crop in South America that is having trouble getting out of the country. But it is going to get out eventually, and that is overwhelmingly bearish factor for both old-crop and new-crop beans," Vaclavik said. As with corn, funds have been liquidating long positions in soyabeans since USDA's stocks report, which showed larger than expected stocks of soyabeans and wheat. For the week, CBOT soyabeans fell 3 percent, a second consecutive week of decline, while wheat rose 1.6 percent.