Wheat, Corn Futures Decline on Signs of Increasing Global, U.S. Production
(Bloomberg) – Wheat and corn futures fell for the second time this week on signs that grain supplies may be ample as countries around the world step up production. Soybeans were little changed.
Global wheat production may be 688.7 million metric tons this year, Informa Economics Inc., an agriculture research company, said today in a note to clients. That was 1.1 percent more than the Department of Agriculture’s forecast last month. Output may climb to 694.2 million tons next year, Informa said. The company raised its forecast for the U.S. corn harvest to 12.5 billion bushels, or 0.9 percent above the USDA projection.
“We keep finding more and more wheat, even though we’re using a lot,” Mike Zuzolo, the president of Global Commodity Analytics & Consulting in Lafayette, Indiana, said in a telephone interview. “Corn is likely to follow wheat because of ample supplies.”
Wheat futures for December delivery dropped 1 percent to settle at $6.235 a bushel at 1:15 p.m. on the Chicago Board of Trade. The most-active contract has dropped 22 percent this year as countries including Russia and Ukraine boost output and ease export restrictions after crops recovered from drought in 2010.
Corn futures for December delivery fell 1.4 percent to $6.45 a bushel. The grain has dropped 19 percent from a record $7.9975 on June 10.
Rain in South America improved prospects of corn and soybeans. Southern Argentina may get as much as 2 inches (5.1 centimeters) in the next 10 days, while northern areas receive as much as 4 inches, QT Weather in Chicago said in a report.
“It’s early still, but they’re going to need some rain because they’re looking at a generally dry growing season if La Nina goes into place,” Tim Emslie, the research manager at Country Hedging Inc., in Inver Grove Heights, Minnesota, said in a telephone interview.
Soybean futures for January delivery rose 0.25 cent to $12.0275 a bushel. The oilseed has dropped 14 percent this year.
The U.S. is the world’s top exporter of wheat, corn and soybeans.
To contact the reporters on this story: Whitney McFerron in Chicago at wmcferron1@bloomberg.net.
To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net
