US crop cut estimate supports soybeans, wheat falls on rain forecasts
Chicago soybean futures rose on Monday, holding around their one-month highs hit on Friday after the U.S. Department of Agriculture (USDA) cut its U.S. soybean crop estimate.
Wheat fell sharply following forecasts of welcome rain in U.S. grain belts. Corn rose after hitting its highest since June on Friday.
Chicago Board of Trade most-active soybeans Sv1 rose 0.6% to $10.36-3/4 a bushel at 1103 GMT.
Wheat Wv1 fell 1.9% to $5.61-1/2 a bushel, corn Cv1 rose 0.1% to $4.31-1/4 a bushel.
U.S. farmers grew fewer soybeans and corn this year than previously expected after a dry spell hurt crops, the USDA said on Friday, pushing Chicago soybeans to one-month high while corn touched a more than four-month high.
However, supplies remain hefty with U.S. farmers expected to have produced their second-biggest soy harvest and third-largest corn harvest ever.
“Soybeans remain higher as the trade continues to respond to the smaller than expected USDA production and yield numbers for the U.S., but the overall market remains choppy,” said Matt Ammermann, StoneX commodity risk manager. “A large U.S. soybean crop is still expected.”
“Corn continues to hold the $4.30 resistance level. The USDA’s corn forecasts were a bit of surprise amid the private estimates saying that bigger U.S. crops were getting bigger. If you apply a larger U.S. corn export programme and ethanol grind, you quickly can find a U.S. corn season-ending carryout stock around equal to last years, despite the record crop seen.”
End-of-season supplies of corn and soybeans are still projected to reach five-year highs, the USDA said.
The USDA also estimated world wheat ending stocks above trade expectations.
“Wheat remains lower in early trade, rains forecast in the U.S. this week could help ease some concerns,” Ammermann said. “The stronger U.S. dollar is unwelcome for U.S. export prospects.”
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