Chicago | Reuters — Chicago Board of Trade (CBOT) corn futures rose on Tuesday to revisit last week’s three-year highs after the U.S. Department of Agriculture said U.S. planting was well behind the average pace for this time of year following repeated rainfall.
Soybeans rose too as rain also slowed U.S. sowings, according to the USDA report. But wheat futures tumbled on Tuesday after USDA said U.S. winter wheat was in better condition than some traders expected, coupled with profit-taking after Monday’s sharp rise.
“Everyone is reacting to the plantings news,” said Karl Setzer, a commodity market adviser at Agrivisor.
The rally in corn, however, was being tempered somewhat by what traders heard from farmers in north-central Iowa, Minnesota and parts of South Dakota, who are still intending to plant more corn, Setzer said.
“What we’re hearing is the guys who can get in the field are actually planting as much corn as possible, instead of soybeans,” Setzer said. “We’re also hearing reports from farmers in the deep South, who are converting cotton acres over to corn because it’s more profitable this year.”
Chicago Board of Trade (CBOT) most-active corn futures contract settled on Tuesday up one cent at $4.25-1/4 a bushel (all figures US$). Corn last week climbed to $4.38 a bushel, its highest since 2016.
The CBOT most-active wheat contract fell 12-1/2 cents, to end the session at $5.07-1/4 a bushel, after rising 3.4 per cent on Monday on concerns about harvest risks from heavy rain. Soybeans rose 2-3/4 cents, closing at $8.81-3/4 a bushel.
Heavy rain continued to plague U.S. farmers last week, especially in the corn belt, as they struggled to complete sowings in waterlogged fields.
USDA said in a report after the market close on Monday that U.S. corn planting was 67 per cent complete, below market expectations of 71 per cent and well below the average pace of 96 per cent at this time of year.
USDA also said U.S. soybean planting was 39 per cent complete, below market expectations of 42 per cent and significantly below the average pace of 79 per cent.
The delayed plantings had some agronomists and traders on Tuesday concerned that the soybean seeds farmers have been able to sow could ultimately prove to have yield issues later in the growing season: They question how much impact the ongoing wet weather, standing water on many fields and overcast skies across much of the U.S. grain belt could have on the plants in the coming months.
“Everything just snowballs onto itself over time,” Setzer said.
Despite fears heavy rain could threaten U.S. wheat, USDA gave a more positive picture of U.S. crops. USDA said 64 per cent of U.S. winter wheat was in good-to-excellent condition, up from 61 per cent last week and expectations of 59 per cent.
— P.J. Huffstutter reports on agriculture and agribusiness for Reuters from Chicago; additional reporting by Michael Hogan, Naveen Thukral and Colin Packham.