Corn, Soybeans Pause After Highs on U.S. Harvest Cuts
Chicago corn and soybean futures edged lower on Tuesday, consolidating near multi-month highs sparked by smaller-than-expected government estimates of the U.S. harvest.
Wheat also ticked lower.
The most active corn contract on the Chicago Board of Trade (CBOT) <Cv1> was down 0.6% at $4.73-3/4 a bushel by 1042 GMT, after reaching $4.77 on Monday, its highest since December 2023.
CBOT soybeans <Sv1> were 0.3% lower at $10.50-1/4 a bushel after rising to $10.56-3/4, the highest since Oct. 2, 2024, earlier in the session.
The U.S. Department of Agriculture (USDA) on Friday jolted the market by slashing its estimates for 2024 U.S. corn and soybean production and end-of-season stocks, implying a tighter supply outlook than expected.
The data led a slew of commodity funds to add to their bullish position in corn and cover short positions in soybeans, traders said.
Funds are now the most bullish on corn since 2022 but are bearish on soybeans due to plentiful supply.
Moreover, demand for U.S. corn has been strong, with the USDA saying that 1,441,006 metric tons were inspected for export in the latest week, well above trade expectations. [USDA/I]
Grain markets are now watching to see if rain forecast for later this week provides some relief for Argentine crops stressed by a heat wave, and if Brazil’s record expected harvest gets going after a rain-slowed start.
“Forecasters say there’s rain on the horizon in Argentina but whether that comes or not, crops will be downgraded,” said Andrew Whitelaw, an analyst at Episode 3 in Canberra.
CBOT wheat <Wv1> was down 0.3% at $5.43-1/2 a bushel. It earlier touched its highest in over a week after rallying on the back of corn’s strength on Monday.
Stiff export competition, underscored by the dollar’s <=USD> recent surge, and the USDA’s bigger than anticipated estimate of U.S. wheat sowing were keeping a lid on prices.
Export prices in top shipper Russia have remained almost unchanged since the beginning of the year amid weak demand.
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