CHICAGO: US spring wheat futures tumbled to the lowest level in nearly 14 months on expectations for a bumper crop this year, while the price for December new-crop corn slumped to a one-month low on prospects for a record harvest.
MGEX spring wheat dropped more than 1 percent on trade expectations for a rebound in spring wheat production following heavy flooding in the northern US Plains that curtailed plantings last year.
Rain and snow around the US Midwest and northern Plains during the past day provided a much-needed boost to soil moisture in key growing areas and further buoyed expectations of big crops.
"The numbers are bearish on corn, bearish on wheat," said Don Roose, analyst for US Commodities. "We are also seeing an increase in moisture systems around the Midwest."
Soybean futures bucked the overall bearish trend in agricultural commodities due to strong export demand for U.S supplies, particularly from top world buyer China.
At 11:30 a.m. CST (1730 GMT), Chicago Board of Trade March soft red winter wheat futures were down 4-1/2 cents at $6.37-1/4 a bushel. The contract slipped below key technical support levels at the 30-day and 100-day moving average during the overnight session but found support near its 50-day moving average.
MGEX March spring wheat dropped 13-1/4 cents to $7.87-3/4 a bushel. The front-month MGEX contract fell to $7.87-1/4, its lowest level since December 1, 2010, earlier in the trading session.
CBOT March corn was down 1-3/4 cents at $6.37-3/4 a bushel. The new-crop December contract fell 6-1/4 cents to $5.52-1/2 a bushel to hit a one-month low.
USDA projected US corn production at 14.270 billion bushels this year based on an expected yield of 164 bushels per acre, up from its previous forecast of 14.235 billion bushels. In 2011, US farmers harvested 12.358 billion bushels of corn on a yield of 147.2 bushels per acre.
The July-December corn spread hit its widest level in five months on Friday as traders piled on their bearish bets for the new crop contract following the government's harvest forecast.
"Acreage numbers followed expectations yesterday and yield numbers predictably came in on the optimistic side today," Matt Zeller, analyst with INTL FCStone said in a research note to clients.
USDA's forecasted wheat crop of 2.165 billion bushels was up 45 million bushels from its earlier view and would represent an 8.3 percent jump from a year earlier.
USDA said on Friday morning that export sales of US soybeans in the latest reporting week were 4,032,400 tonnes, above a range of trade estimates for 3,500,000 to 3,900,000 tonnes. USDA said China bought 521,100 tonnes for 2011/12 and 2,805,000 for 2012/13.
CBOT March soybeans were up 4-1/2 cents at $12.81-1/4 a bushel. Prices peaked at $12.84-3/4, their highest level since September 23.
The USDA this week confirmed further sales to China, totaling 425,000 tonnes, on Tuesday and Wednesday. These sales will show up in next week's USDA export sales report.
"That has been our bull story on soybeans," Roose said. "The export pace continues to be strong and that is underneath the market here."
USDA also projected ending stocks of soybeans for the 2012/13 crop year at 205 million bushels, down from its previous estimate of 209 million bushels and below 275 million for the 2011/12 crop year. Rising exports were seen diminishing the soybean stockpile.
"Beans are shockingly bullish, we're shifting from grain concerns now to bean concerns," said Matt Pierce, analyst for GrainAnalyst.com.
Light rain, rain mixed with snow and snow was moving through the north central and northern Midwest leaving beneficial soil moisture ahead of spring.
"It will continue today and end this evening but more snow is expected in the far north on Sunday with light rain expected in the Central Plains by Monday," said Don Keeney, meteorologist for MDA EarthSat Weather. "There will be more snow in the northern Plains on Tuesday so definitely they're going to see a lot of snow which will be good for them."
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