(Reuters) – Chicago wheat fell to its lowest in more than three weeks on Monday with the market facing pressure from abundant global supplies and improved weather in parts of the U.S. Plains.
Corn dropped for a fourth consecutive session, while soybeans lost ground after closing higher for the previous two sessions on support from a severe drought curbing Argentina’s crop yields.
Expectations of improved weather in parts of the drought-hit U.S. southern Plains are adding pressure to wheat futures.
At the same time, favourable weather ahead of spring grain sowing in Black Sea producers Russia and Ukraine is bolstering the chances of another large wheat harvest due to good levels of soil moisture, analysts and industry officials said.
The Chicago Board of Trade most-active wheat contract fell to its lowest since Feb. 22 at $4.62 a bushel. The market was trading down 1.1 percent at $4.62-1/2 a bushel at 0326 GMT.
Corn gave up 0.8 percent to trade at $3.79-3/4 a bushel and soybeans fell 1 percent to $10.38-3/4 a bushel.
“There are no real supply issues, the market is giving up gains made at the end of February,” said one Singapore-based wheat trader.
A second trader in Singapore said the decline in wheat, corn and soybean prices is more to do with positioning by investment funds.
The decline in corn came despite strong demand for U.S. supplies.
Importers are buying U.S. corn at the fastest pace since the mid-1990s, according to U.S. government data, as tightening stocks in Latin America prompt a rush to purchase cargoes of the grain from animal feeders worldwide.
The drought in Argentina and limited corn supplies in Brazil, two of the three largest exporters, have opened a window of opportunity for top supplier the United States, which has the largest available surplus for export.
The Rosario Grains Exchange on Thursday cut its estimate of Argentina’s soy harvest to 40 million bushels from 46.5 million previously.
That was also well below the 47 million tonnes forecast by the U.S. Department of Agriculture (USDA) this month.
Large speculators raised their net long position in CBOT corn futures in the week to March 13, regulatory data released on Friday showed.
The Commodity Futures Trading Commission’s weekly commitments of traders report also showed that non-commercial traders, a category that includes hedge funds, increased their net short position in CBOT wheat and cut their net long position in soybeans.
