US wheat futures tumbled more than 3 percent on Wednesday, on pace for their largest losses in two weeks, after the US Department of Agriculture in a monthly supply and demand report boosted its production forecast for the winter wheat crop. Corn futures also were lower at the Chicago Board of Trade, pressured by plentiful domestic and global grain supplies, while soyabean futures were narrowly mixed.
Most-active CBOT July wheat revered from an earlier two-month high, notching an 'outside day' on the charts that could signal a near-term high. The contract was 17-1/2 cents lower at $5.14-3/4 per bushel as of 11:45 am CDT (1645 GMT), extending losses posted following the release of the report 45 minutes earlier. Euronext milling wheat futures also fell sharply even as scouts on a crop tour in France predicted dry weather could reduce yields in the European Union's top producer.
USDA forecast winter wheat production at 1.505 billion bushels, up 33 million bushels from the outlook it issued last month. However, rainfall that helped boost production in the southern US Plains also caused isolated flooding and crop damage. The harvest is just getting under way and overall quality of the crop will not be determined for weeks, analysts say.
USDA lowered its soyabean supply outlook for the 2015/16 crop year due to increased domestic usage and raised its view of corn supplies due to lower ethanol production. The government on June 30 will issue its annual acreage report: how much corn, soyabeans, spring wheat and other crops were seeded this spring. That release typically results in more volatile swings in futures prices than the more routine monthly supply reports. CBOT July corn was down 6-1/4 cents to $3.58-3/4 per bushel and CBOT July soyabeans were 1/4 cent lower at $9.51-1/4.