Chicago | Reuters –– U.S. corn futures rose about 1.4 per cent on Wednesday after the U.S. Department of Agriculture’s initial condition ratings for the crop fell below trade expectations.
Nearby soybeans also closed firm while wheat turned lower toward the close, after spending most of the session higher.
Chicago Board of Trade July corn settled up five cents at $3.72 per bushel after reaching $3.76-1/2, its highest since May 22 (all figures US$). CBOT July soybeans ended up 3-1/4 cents at $9.16 a bushel and July wheat finished down 1/4 cent at $4.29-1/4 a bushel.
Corn climbed after USDA late Tuesday, in its first weekly corn condition ratings for 2017, rated 65 per cent of the crop as good to excellent.
The figure fell below an average of analyst expectations for 68 per cent and was down from 72 per cent a year ago. It raised concerns that the crop might not be able to meet the government’s initial yield projection of 170.7 bushels per acre, based on historical trends.
Ratings were lowest in the eastern half of the Midwest, where excessive rains swamped fields this spring.
“Historically we have a limited chance to make trend-line yields when our good-to-excellent ratings are below 70 per cent at this time of year. So the market is really forced to add some premium into prices,” said Brian Hoops, analyst with Midwest Marketing Solutions.
Soybeans ended mixed, with nearbys up on bargain-buying after the July dipped to $9.09-1/2, the lowest price for a most-active contract since early April 2016.
Strength in corn lent support, along with worries about port strikes that could limit the flow of soy from Argentina, the world’s top soymeal exporter.
But soybeans traded lower at times, pressed by a record-large Brazilian harvest, poor crush margins in top buyer China and an expected jump in U.S. soybean seedings.
CBOT wheat faded late in the day after drawing early support from disappointing crop ratings. USDA rated 50 per cent of the U.S. winter wheat crop in good to excellent condition, down from 52 per cent the previous week.
Spring wheat futures on the Minneapolis Grain Exchange advanced after USDA rated 62 percent of the U.S. spring wheat crop as good to excellent, well below an average of trade expectations for 71 per cent. The figures underscored worries about dry weather in the northern U.S. Plains production region.
Egypt’s state grain buyer GASC bought 180,000 tonnes of wheat in an international purchase tender, including 120,000 tonnes of Russian and 60,000 tonnes of Romanian origin. GASC passed on offers of U.S. hard red winter wheat.
— Julie Ingwersen is a Reuters commodities correspondent in Chicago. Additional reporting for Reuters by Colin Packham in Sydney and Gus Trompiz in Paris.