Soybeans dropped for a second day after the U.S. Department of Agriculture increased its estimates for global production and stockpiles. Wheat advanced.
Global inventories before the next Northern Hemisphere harvest in 2014 will be 73.01 million metric tons, compared with 72.3 million tons estimated in January and more than analysts expected in a Bloomberg survey, the USDA said yesterday. World output will total 287.69 million tons, compared with 286.83 million tons forecast last month, according to the report.
“The USDA report was bearish for oilseed prices, raising fears the recent rally may have run out of fundamental support,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, wrote in a note today.
Soybeans for March delivery fell 0.3 percent to $13.22 a bushel at 4:05 a.m. on the Chicago Board of Trade. Prices rose for seven sessions through Feb. 7, the longest rally since March 2012, amid concern that hot, dry weather would erode prospects for crops in Brazil, the world’s biggest exporter.
Growing areas in Brazilian states of Rio Grande do Sul, Mato Grosso do Sul and Parana will see showers later this week, easing dry conditions, forecaster DTN said. The USDA raised its estimate yesterday for the country’s crop to a record 90 million tons, from a previous estimate of 89 million.
Corn for March delivery fell 0.2 percent to $4.4225 a bushel. The price declined 0.3 percent yesterday, even as the USDA cut its outlook for U.S. and world inventories by more than analysts expected.
Wheat for March delivery advanced 0.4 percent to $5.8725 a bushel after a 1.3 percent jump yesterday. In Paris, milling wheat for November delivery gained 0.1 percent to 185 euros ($253) a ton on NYSE Liffe.
Domestic U.S. wheat reserves on May 31 will be 558 million bushels, less than the 608 million bushels forecast last month, according to the USDA. Global inventories will reach 183.73 million tons, down from 185.4 million estimated in January, it said. Wheat slid 22 percent last year in Chicago on the outlook for record global production.
The “report was considered as slightly bullish by most of the U.S. and French traders as the USDA decreased the world wheat stock,” Arnaud Saulais, a broker at Starsupply Commodity Brokers in Nyon, Switzerland, said in an e-mailed report. “In the long term, most of the French co-ops and trade houses are remaining bearish on milling wheat as the new crop is expected to be good if weather conditions remain normal.”