(NASDAQ) – Grain and soybean futures dropped Thursday as largely benevolent Midwest weather fueled expectations that U.S. farmers would reap bumper harvests in the fall.
Corn prices fell to a nearly 22-month low, weighed down by mounting anticipation that growers will collect a record crop this year thanks to good growing conditions across much of the Farm Belt. While a heat wave threatened crops earlier this month and more hot weather is due to descend on crop-growing regions in August, the nation’s corn crop is in prime health, according to federal data.
“The market is pricing in expectations of a corn yield increase” in the supply-and-demand report due out Aug. 12, said Arlan Suderman of brokerage INTL FCStone.
Corn futures for delivery in September slid 4 1/2 cents, or 1.3%, to $3.31 1/4 a bushel at the Chicago Board of Trade, the lowest closing price since Oct. 2014.
Disappointing weekly export sales data also pressured corn prices on Thursday, with the USDA reporting net corn sales for the week ended Jul. 21 totaled 915,300 metric tons for delivery in the 2015-16 and 2016-17 crop years. Analysts had expected sales between 800,000 and 1.5 million tons.
Meanwhile, soybean prices declined after posting gains for two straight sessions as Midwest weather forecasts turned wetter, with rain added to the outlook in 6 to 10 days. August is the most critical month for soybean development, and the prospect of more moisture helped quell earlier fears that heat and dryness would dent crop yields.
Weaker-than-expected weekly export sales also buffeted soybean prices, with the USDA reporting net sales of 676,800 metric tons, below analysts’ forecast for 800,000 to 1.5 million tons.
CBOT August soybeans fell 7 cents, or 0.7%, to $10.03 1/2 a bushel. Federal forecasters in July said farmers likely will harvest the third-largest soybean crop in history.
Wheat prices also lowered, weighed down by falling corn prices and updated production forecasts from the London-based International Grains Council, which on Thursday raised its projection for global grain output to near-records. According to the IGC, farmers across the world will produce 2.046 billion tons of grain this year, including 735 million tons of wheat, which is increased from last month’s estimate by 6 million tons.
CBOT September wheat shed 4 1/2 cents, or 1.1%, to $4.10 1/4 a bushel.
Read more: http://www.nasdaq.com/article/grains-soybeans-decline-amid-optimism-over-us-crops-20160728-01476#ixzz4Fo8U92tl
