Wheat slides on record global stocks estimate

CHICAGO: Chicago wheat futures slid on Thursday after the US Department of Agriculture estimated global stocks were at a record in its monthly supply and demand report, traders said.

Soybean futures were near unchanged as the USDA lowered export expectations, even after recent purchases from China supported prices. Corn advanced as the USDA reported better than expected demand for corn-based ethanol.

The most-active wheat contract on the Chicago Board of Trade was down 6-1/4 cents at $5.00 a bushel by 12:06 p.m. (1706 GMT).

CBOT soybeans were up 1 cent at $8.66-1/2 a bushel and corn was up 2 cents at $3.28-1/4 a bushel. Higher global wheat supplies weighed on the market, while global usage lowered only fractionally. The agency raised world ending stocks to a record high 316.1 million tonnes.

"Wheat didn't have a great report," said Craig Turner, senior ag broker with Daniels Trading. "That was a big bearish surprise."

Leading Russian consultancies revised forecasts for this year's Russian wheat harvest, tempering concern about the effects of a dry spring.

Corn traded higher as the USDA reduced its 2019/20 corn-for-ethanol demand estimate by 50 million bushels from May, less than analyst predictions of 100 million or greater.

The USDA left US soybean planted acres unchanged from its March predictions, in contrast to some analyst predictions that farmers had switched corn acres for soybeans after ethanol production slumped due to the coronavirus lockdowns.

"Beans are being moved by production," said Mark Gold, founder of Top Third Ag Marketing. "Most were looking for a big increase and they didn't get it."

The USDA's weekly US grain export sales report showed soybean sales above trade estimates, with a combined 2.2 million tonnes purchased by China and unknown destinations, the largest reported single week of sales since February 2019.

Chinese state-owned Sinograin bought at least 120,000 tonnes of US soybeans for shipment in December on Tuesday, traders said.