Corn, wheat edge up after lows

Imaduddin September 4, 2019

PARIS/SINGAPORE: Chicago corn and wheat futures ticked higher on Wednesday, steadying after multi-month lows in the previous session as traders awaited further clues on prospects for US harvests and exports.

Soybeans also edged up as a drop in the dollar and gains across commodity and equity markets lent support to crop prices.

Soybean investors were seeking fresh indications on US-Chinese discussions to resolve a trade dispute that has stalled US soybean exports.

The most-active corn contract on the Chicago Board of Trade was up 0.1% at $3.61-1/2 a bushel by the end of the overnight trading session.

It had closed down 2.4% in the previous session, when prices hit their lowest since May 14 at $3.60-1/2.

CBOT wheat gained 0.8% to $4.57-1/4 a bushel. On Tuesday it had slipped like corn to its weakest since mid-May.

Soybeans were up 0.4% at $8.72-1/4 a bushel.

A fall in the dollar index, which gave back some of its recent gains, helped underpin Chicago crop prices by making them more attractive overseas.

But corn and wheat held near Tuesday’s lows as the focus remained on large US and global crop supplies.

“On the global supply front we have ample supplies of wheat and weather is proving to be pretty decent for corn in the United States,” said Ole Houe, director of advisory services at brokerage IKON Commodities in Sydney.

“And it looks like the export pace is slow.”

The US Department of Agriculture rated 58% of the US corn crop in good-to-excellent condition, up from 57% the previous week and in line with trade expectations. The USDA said 6% of the crop was mature, behind the five-year average of 13%.

At least 55% of the soybean crop is in good-to-excellent condition, the USDA said, slightly behind market expectations.

The wheat market is being weighed down on prospects for plentiful global stockpiles.

A large hard red winter (HRW) wheat harvest in the United States has put particular pressure on Kansas HRW futures. Spot prices touched their lowest since December 2005 on Tuesday at $3.61-3/4 a bushel, before recovering slightly on Wednesday.

Paris wheat futures have slipped to their lowest levels in over a year amid doubts as to whether the European Union will shift enough of its much bigger harvest this year.

“The EU is looking forward to significantly higher exports in 2019/20 than in the previous year,” Commerzbank analysts wrote. “At the same time, there is considerable competition from the Black Sea region again.”

Copyright Reuters, 2019

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