US corn and soyabean futures rose on Tuesday as traders squared positions a day ahead of a monthly US Department of Agriculture report in which the government is expected to pare its stocks forecasts for both crops, traders said. Wheat followed corn and soya higher, bolstered by updated midday forecasts that no longer saw as much rain as had been expected next week in the southern US Plains.
At the Chicago Board of Trade, May corn settled up 7-3/4 cents at $5.07 per bushel after reaching a one-week high of $5.07-3/4. May soyabeans ended up 18-1/4 cents at $14.82-1/2 a bushel, while May wheat rose 4-3/4 cents at $6.81 a bushel. Trade was disrupted late in the session when the CME Group's Globex electronic system shut down due to technical issues. Trading continued in the open outcry pits. CME Group is the parent of the CBOT.
Corn posted the biggest percentage gains of the three main commodities. The USDA in its monthly supply/demand report on Wednesday is likely to lower its forecasts of US 2013/14 corn and soyabean ending stocks due to robust exports, according to analysts surveyed by Reuters. "Much of what we are seeing is simple positioning ahead of tomorrow's supply and demand report," said Karl Setzer, a market analyst at the MaxYield Co-operative in West Bend, Iowa. "Current US corn sales are 2 million bushels greater than USDA expectations," Setzer added.
Corn drew additional support from a sluggish start to planting in the heart of the US Corn Belt, where soil temperatures are still too cold after a harsh winter. "The weather outlook for planting is slowly improving, but also offers enough potential delays to keep concerns elevated," Citigroup futures specialist Art Liming wrote in a market note.
"Planting in the Delta and Southeast has been put mostly on hold by recent downpours, and the region is expected to see further precipitation before fieldwork can progress," Liming said. Gains were limited by news that China's quarantine bureau approved corn imports from Brazil, adding to a growing list of suppliers competing for shipments to the second-largest consumer of the grain.
Soyabeans rose on expectations that USDA on Wednesday will cut its outlook for US 2013/14 soyabean ending stocks to 139 million bushels, the smallest in five years. USDA also was expected to cut its forecast for the Brazilian soyabean harvest to 87.43 million bushels. Wheat rallied from early declines after updated midday weather forecast models looked drier in the southern US Plains production belt.