July 13, 2017 / 1:01 AM / 13 days ago

GRAINS-Wheat falls nearly 2 percent to hit two-week low

4 Min Read

    SYDNEY, July 13 (Reuters) - U.S. wheat fell nearly 2 percent
on Thursday to hit a two-week low as prices came under pressure
from the U.S. Department of Agriculture's surprising increase to
end of season U.S. supplies.
         
    FUNDAMENTALS  
    * The most active wheat futures on the Chicago Board Of
Trade were trading down 1.8 percent at $5.27-1/2 a bushel
0033 GMT, near the session low of $5.27-1/4 a bushel - the
lowest since June 30. Wheat closed down 2.9 percent on
Wednesday. 
    * The most active soybean futures were down 1.1
percent at $10.22-3/4 a bushel, near the session low of
$10.18-1/2 a bushel - the lowest since July 7. Soybeans closed
down 0.9 percent on Wednesday.
    * The most active corn futures fell 0.8 percent to
$3.95-3/4 a bushel, near the session low of $3.95-1/4 a bushel,
the lowest since July 6. Corn slumped 3.7 percent in the
previous session.
    * The USDA in a monthly report raised its forecast of U.S.
wheat stocks at the end of the 2017/18 marketing year to 938
million bushels, from 924 million in June, bucking most trade
expectations for a decline.
    * The USDA also raised its forecasts of end 2017/18 U.S.
corn stocks to 2.325 billion bushels, up from 2.110 billion in
June and above an average of analyst estimates for 2.181
billion.
    * The USDA left its U.S. 2017 corn yield forecast unchanged
at 170.7 bushels per acre. Some analysts had expected a
reduction due to stressful hot and dry conditions in parts of
the Midwest.
    * The USDA lowered its soy ending stocks forecasts for both
the 2016/17 and 2017/18 marketing years. 
    * Welcome rains over the last two days in Iowa and Illinois,
the top two producers of corn and soybeans, also pressured
futures, along with updated midday forecast models calling for
milder conditions in the Midwest.
    
    MARKET NEWS  
    * The dollar eased against the yen on Wednesday, after
Federal Reserve Chair Janet Yellen said interest rates hikes
would be gradual and that the U.S. central bank may not be able
to raise rates by "all that much."  
    * Oil futures rose, maintaining some gains from earlier in
the day, as a report showing hefty drawdowns in U.S. crude
inventories was offset by data pointing to lackluster gasoline
demand.  
    * The Dow rose to a record high close while U.S. stocks kept
their upward momentum Wednesday following Federal Reserve Chair
Janet Yellen's congressional testimony to gradually raise
interest rates.  
    
    DATA AHEAD (GMT)   
       China         Foreign direct investment           June 
       China         M2 money supply                    June  
       China         New yuan loans                    June  
0830   U.K.          Jobless rate (ILO)                May 
0900   Euro zone     Industry output                     May 
1100   U.S.          Home mortgage applications          weekly
        
 Grains prices at  0033 GMT
 Contract       Last    Change   Pct chg  Two-day chg    MA 30  RSI 
 CBOT wheat   527.50     -9.50    -1.77%       -4.61%   489.30    62
 CBOT corn    395.75     -3.00    -0.75%       -4.47%   397.56    46
 CBOT soy    1022.75    -11.25    -1.09%       -1.97%   955.89    83
 CBOT rice     11.89     $0.05    +0.46%       -1.49%   $11.68    53
 WTI crude     45.32    -$0.17    -0.37%       +0.62%   $45.22    53
 Currencies                                                         
 Euro/dlr     $1.142    $0.001    +0.12%       -0.36%               
 USD/AUD      0.7685     0.001    +0.13%       +0.67%               
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential
 
 (Reporting by Colin Packham; Editing by Richard Pullin)
  

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