PARIS/CANBERRA: Chicago corn inched up on Wednesday, consolidating after a pullback from an 18-month peak last Friday, as traders awaited U.S. planting forecasts and more indications on U.S. tariffs.
Wheat futures steadied in step with corn having also retreated from a multi-month high last week, while soybeans edged lower.
Grains were also taking their cue from broader financial markets, with crude oil and the dollar index consolidating after losses fuelled by uncertainty over U.S. tariffs.
The most active corn contract on the Chicago Board of Trade (CBOT) was up 0.15% at $4.95 a bushel by 1046 GMT.
Prices surged to an 18-month high last Friday as concerns over South American weather reinforced expectations of tightening global supply.
But improving weather conditions in South America and signs that U.S. farmers will expand corn planting encouraged selling this week by commodity funds that have a large net long position.
Attention is turning to the U.S. Department of Agriculture’s (USDA) annual Outlook Forum at which it will give early projections for corn and soybean planting on Thursday, with analysts expecting a shift in acreage from soybeans towards corn.
Corn steadies after sell-off knocks prices from 18-month high
“CBOT corn is overvalued,” said Ole Houe at brokers and consultants IKON Commodities in Sydney.
Proposed U.S. tariffs, which President Donald Trump has said are on track to be levied on imports from Mexico and Canada, were also hanging over grain markets as traders saw the risk of reprisals against U.S. agricultural exports.
“It’s technical consolidation. I can’t see prices rebounding really before there’s news on the tariffs for Mexico and Canada and with the planting data tomorrow,” a European trader said.
CBOT wheat was up 0.13% at $5.88-1/2 a bushel and soybeans were 0.3% lower at $10.45-1/2 bushel.
Soybeans remained curbed by an advancing Brazilian harvest, widely forecast to reach a record volume.
Wheat, however, was seen as having upward potential given the ebbing supply in top exporter Russia.
“Russia will most likely have a smaller crop than last year and demand is relatively strong. There’s lots of immediate supply. But physical prices are gradually going up as the market gets tighter,” Houe said.
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