(Reuters) – Chicago corn and wheat futures rebounded on Thursday after dropping more than 2 percent in the last session after U.S. government estimates of bin-busting supplies.
Soybeans ticked up after dropping on Wednesday to the lowest since the end of September as the U.S. Department of Agriculture
(USDA) raised its production forecast.
The Chicago Board Of Trade most-active corn contract added 0.4 percent to $3.38-1/4 a bushel by 0301 GMT, having closed down 2.5 percent in the previous session when prices fell to a low of $3.36-1/2 a bushel, the weakest since Oct. 3.
Soybeans rose 0.3 percent to $9.48-1/4 a bushel, having closed down 0.9 percent in the last session and wheat gained 0.4 percent to $3.98-1/2 a bushel, having closed down 2.6 percent on Wednesday.
The USDA lowered its estimate of the U.S. 2016 corn yield to 173.4 bushels per acre, from 174.4 in September, but that would still be the highest on record, if realized.
It raised its U.S. soybean yield estimate to a record-high 51.4 bushels per acre, roughly in line with analyst expectations.
The agency raised its forecast of U.S. wheat ending stocks to 1.138 billion bushels, the most since 1987-88 marketing year, if realized.
Analysts said the focus will now shift to next year’s crops. “How much cheaper can grains get? I think we have seen the bottom,” said Ole Houe, an analyst with brokerage IKON
Commodities in Sydney.
“U.S. harvest is half over, now we have to shift thinking from having grown massive crops to what is in store next year. There are concerns about Black Sea and South American weather.”
Farmers in Brazil and Argentina have started planting corn and soybeans which will be harvested early next year. There have been concerns over dryness in Brazil and Ukraine.
In news, China approved 2017 low-tariff import quotas for grains, the country’s state planner said on Thursday, although ample domestic supplies mean the country is unlikely to buy large volumes.
The quotas, carrying tariffs of just 1 percent, remain unchanged from previous years, with the wheat quota at 9.6 million tonnes and corn at 7.2 million tonnes.
Commodity funds were net sellers of CBOT corn, soybean and wheat futures on Wednesday. Trade estimates of net fund selling in corn ranged from 10,000 to 25,000 contracts, in soybeans from 4,000 to 11,000 contracts and in wheat from 4,000 to 6,000 contracts.
