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Chicago agricultural commodities settle lower as USDA raises crop yield estimate

Xinhua, October 13, 2016 Adjust font size:

Chicago Board of Trade (CBOT) grains futures close lower Wednesday, as U.S. Department of Agriculture (USDA) again boosted their outlook for soybean and grains.

The most active corn contract for December delivery fell 8.5 cents, or 2.46 percent, to 3.37 dollars per bushel. December wheat delivery dropped 10.5 cents, or 2.58 percent, to 3.9675 dollars per bushel. November soybeans fell 8.75 cents, or 0.92 percent, to 9.455 dollars per bushel.

Corn production is also set for a record year and with plentiful domestic supplies of other crops such as wheat and rice, the U.S. has become more reliant on export markets to absorb the bumper harvests.

A relief rally in soybean futures after the latest monthly update was released Wednesday by USDA quickly evaporated, and corn and wheat prices both fell sharply.

U.S. farmers are expected to harvest a record 4.269 billion bushels of soybeans, just shy of analysts' expectations. The bump-up yield of 51.4 bushels an acre following August rains was in line with trade guesses, with some concerned yields could top 52 bushels.

Corn futures sagged after an early gain, even as the USDA trimmed its production forecast from September. The agency expects production to reach a record 15.057 billion bushels on yields of 173.4 bushels an acre this fall. That compares to analysts' estimates for 15.04 billion bushels.

Wheat prices initially advanced after the USDA projected slightly smaller-than-expected U.S. stockpiles, before losing ground.

The USDA said domestic wheat reserves at the end of the 2016-17 season in May would total 1.138 billion bushels, which is up from its September estimate of 1.1 billion bushels but lower than analysts' average guess of 1.151 billion bushels.

The USDA was bullish on export prospects, bumping up projected 2016-17 soybean shipments by 40 million bushels at the expense of Argentine sales. Wheat-export expectations were raised by 25 million bushels, reflecting sales success in North Africa that is taking share from European Union sellers, the USDA notes. Endit