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GRAINS-Wheat falls 2 pct to two-week low on U.S. govt forecast
July 13, 2017 / 2:52 AM / 2 months ago

GRAINS-Wheat falls 2 pct to two-week low on U.S. govt forecast

    * USDA estimate eases fears of tight U.S. wheat supply
    * Corn prices fall 1 pct to hit one-week low
    * Soybeans extend two-day losses to nearly 2.5 pct

    By Colin Packham
    SYDNEY, July 13 (Reuters) - U.S. wheat fell 2 percent on
Thursday to hit a two-week low after the U.S. Department of
Agriculture raised its estimate for U.S. production this season,
easing fears of tight supply after recent dry weather.
    Corn prices dropped 1 percent to hit a one-week low, while
soybeans extend two-day losses to nearly 2.5 percent.
     The most active wheat futures on the Chicago Board of Trade
 were trading down 2 percent at $5.27-1/2 a bushel at 0216
GMT, after earlier touching their lowest since June 30 at
$5.22-3/4. Wheat closed down 2.9 percent on Wednesday.
    Analysts said prices were under pressure from the USDA's
decision to increase its U.S. production estimate. That eased
fears of supply shortages as the country's spring crop suffers
from sustained dry weather, which pushed prices to a two-year
high last week.
    "U.S. winter wheat production came in around 5 percent
higher than the market had expected," said Angus Thornton,
commodity analyst at Profarmer.
    "The fact the U.S. numbers were more bearish than expected
took some of the heat out of CBOT wheat markets."
    With the USDA raising its estimate for the U.S. winter wheat
crop at 1.279 billion bushels, the government agency pegged
overall 2017/18 U.S. wheat production above market expectations.
  
    The most active soybean futures were down 1.6 percent
at $10.17-1/2 a bushel, near the session-low of $10.16-3/4 a
bushel - the weakest since July 7. Soybeans closed down 0.9
percent on Wednesday.
    The most active corn futures fell 1 percent to $3.954
per bushel, having previously touched their lowest since July 6
at $3.95-1/4 a bushel. Corn slumped 3.7 percent the session
before.
    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 decline in corn comes despite concerns that recent hot,
dry weather across the Plains will see widespread production
losses.
    Despite those fears, the USDA left its U.S. 2017 corn yield
forecast unchanged at 170.7 bushels per acre. 
    The USDA lowered its soy ending stocks forecasts for both
the 2016/17 and 2017/18 marketing years.
        
 Grains prices at  0216 GMT
 Contract         Last   Change  Pct chg   Two-day chg   MA 30  RSI 
 CBOT wheat     526.25   -10.75   -2.00%        -4.84%  489.26    62
 CBOT corn      395.00    -3.75   -0.94%        -4.65%  397.53    46
 CBOT soy      1017.50   -16.50   -1.60%        -2.47%  955.72    83
 CBOT rice       11.83   -$0.01   -0.04%        -1.99%  $11.68    53
 WTI crude       45.43   -$0.06   -0.13%        +0.87%  $45.22    54
 Currencies                                                         
 Euro/dlr       $1.144   $0.002   +0.22%        -0.26%              
 USD/AUD        0.7680    0.001   +0.07%        +0.60%              
 Most active contracts
 Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
 RSI 14, exponential
 
 (Reporting by Colin Packham; Editing by Joseph Radford)
  

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