Corn eases on stable U.S. crop condition, wheat struggles

In Commodity News 29/06/2016

Chicago corn futures lost ground on Tuesday, falling for a sixth out of seven sessions, as a U.S. government report showed healthy crop conditions despite concerns over dry weather.

Soybeans rose for a second session, underpinned by forecasts of dry weather in the U.S. crop belt next month while the wheat market faced headwinds from a rapidly progressing U.S. harvest.

Chicago Board of Trade most-active corn contract was down 0.3 percent to $3.84-1/4 a bushel by 0215 GMT, while soybeans gained 0.3 percent to $11.08-1/2 a bushel. Wheat lost 0.1 percent to $4.58 a bushel.

“U.S. corn conditions came in unchanged on the previous week, so prices struggled,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia. “Some of the driest areas of the U.S. Midwest received rain over the weekend.

The Delta and Southeast mostly trended drier, but meteorologists say the region should see widespread precipitation today.” After the CBOT closed on Monday, the U.S. Department of Agriculture rated 75 percent of the U.S. corn crop as good to excellent, bucking expectations for a downgrade.

Wheat futures have come under pressure on reports of large yields from the U.S. winter crop. U.S. farmers have finished harvesting 45 percent of the winter crop as compared with 25 percent a week ago and above the five-year average of 41 percent, the USDA said. Soybeans were underpinned by forecasts of a return to hot temperatures in the second half of July.

The USDA rated 72 percent of the U.S. soybean crop in good to excellent condition, down from 73 percent the previous week and in line with analyst expectations.

The agency in a separate report confirmed sales of another 150,000 tonnes of U.S. soybeans to unknown destinations on Monday, following sales announcements of more than 400,000 tonnes on Friday.

The USDA is set to release closely watched stocks and plantings estimates on Thursday.

Those reports will show the extent to which brisk export demand has whittled down corn and soybean inventories, and whether farmers planted more soybeans and less corn than initially expected due to a spring rally in soy prices.

Commodity funds were net buyers of CBOT soybean futures contracts on Monday and net sellers of corn and wheat.

Trade estimates of fund buying in soybeans ranged from 6,000 to 18,000 contracts, and estimates of fund selling in wheat ranged from 4,000 to 5,000 contracts. Estimates of fund activity in corn ranged from net sellers of 6,000 contracts to net buyers of 4,000 contracts.

 Grains prices at  0215 GMT
 Contract    Last     Change   Pct chg  Two-day chg  MA 30    RSI
 CBOT wheat  458.00   -0.25    -0.05%   +0.83%       478.49   21
 CBOT corn   384.25   -1.00    -0.26%   -0.77%       410.29   26
 CBOT soy    1108.50  3.75     +0.34%   +0.64%       1105.87  50
 CBOT rice   11.10    $0.00    +0.00%   +2.64%       $11.37   30
 WTI crude   46.76    $0.43    +0.93%   -1.85%       $48.74   38
 Currencies                                                   
 Euro/dlr    $1.104   -$0.008  -0.68%   -3.04%                
 USD/AUD     0.7376   -0.008   -1.10%   -3.05%                
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential

Source: Reuters (Reporting by Naveen Thukral; Editing by Ed Davies)