(Reuters) – SINGAPORE, July 1 U.S. wheat lost more ground on Friday with the market set for a fourth week of decline, as a U.S. Department of Agriculture (USDA) report that pegged plantings above expectations dragged on prices.
Corn, which has lost around 15 percent in two weeks of losses, is expected to decline further as excess wheat supply takes its market share in the animal feed market.
Chicago Board Of Trade most-active wheat contract is down nearly 5 percent this week. In the previous session, prices hit a low of $4.36 a bushel, the weakest since June 2010.
Corn, which plumbed an 11-week low of $3.65-1/4 a bushel on Thursday, has given up more than 3 percent this week.
“Corn had rallied due to spillover from gains in the soybean market but the reality is that there is too much corn around and now we have increase in U.S. acreage,” said Phin Ziebel, agribusiness economist at National Australia Bank in Melbourne.
“The supply and demand situation is bearish for grains and more so for corn as feed wheat is going to eat into its market share.”
The USDA, in an acreage report, said domestic all-wheat plantings totaled 50.816 million acres, topping analysts’ forecasts for 49.869 million and the agency’s March estimate of 49.559 million.
Corn seedings were 94.148 million acres, above the high end of analysts’ estimates. On an average, they had expected acreage to fall from the government’s March forecast of 93.601 million.
The USDA, in a separate report, said corn inventories as of June 1 were the biggest since 1988 while soybean stocks for that period were the third biggest ever.
Soybean futures are up nearly 7 percent this week, the biggest weekly gain since October 2014.
The acreage report showed farmers planted a record 83.688 million soybean acres, above the government’s March forecast of 82.236 million but below analysts’ estimates for 83.834 million.
Commodity funds were net sellers of CBOT corn contracts on Thursday and net buyers of soybean futures.
Trader estimates of fund selling in corn ranged from 15,000 to 25,000 contracts, and estimates of fund buying in soybeans ranged from 14,000 to 25,000 contracts. Estimates of fund buying in wheat ranged from zero to 5,000 contracts.
