Chicago / Reuters – U.S. corn and soybean futures posted sharp declines on Wednesday, with corn hitting its lowest in nearly two years as the latest weather outlook appeared less threatening to crop development, traders said.
Soybean futures led the sell-off, sinking 2 per cent and hitting their lowest since April 26.
Wheat futures also fell, with traders locking in profits from surprise gains during the overnight session.
The midday weather forecast calls for adequate rain and moderate temperatures during August, which is the critical period of development for much of the U.S. soybean crop. The view eased concerns about the La Nina weather phenomenon laying waste to yields.
For corn, more rain was added to the outlook for key growing areas, which will help protect the crop from the scorching temperatures during the next few days. Additionally, temperatures are expected to quickly moderate from their highs, easing stress on the crop as it pollinates.
Chicago Board of Trade November soybean futures closed down 18-3/4 cents at $10.09 a bushel.
“Prospects for less threatening weather in August, when (soybean) yields are made, continues to put the market back on its heels,” Bryce Knorr, senior grain market analyst at Farm Futures, said in a note.
CBOT December corn dropped 4-1/4 cents to $3.44-1/4 a bushel. CBOT September soft red winter wheat closed down 5 cents at $4.13 a bushel.
Declines in corn were limited as traders waited to see how hot it would get in the coming days.
“U.S. crop ratings were good this week, but a lot can still change with adverse weather, and I expect the market to continue its focus on U.S. weather forecasts for the coming weeks,” said Frank Rijkers, agri-food economist at ABN AMRO Bank.
Prospects for a pick-up in exports also put a floor under the corn market.
Argentine grain truckers started an open-ended strike on Monday over transport prices. Corn exports from Argentina, the world’s No. 3 supplier, could slow in the days ahead if farmers and striking truck drivers fail to reach a deal, an exporters’ organization said.
Additional reporting by Michael Hogan in Hamburg and Naveen Thukral in Singapore; Editing by David Clarke and Tom Brown