News
25.01.2010
Wheat and Corn Fall on Forecast for Larger Harvests Worldwide
Wheat and corn fell in Chicago, heading for a second weekly drop, after the International Grains Council lifted its estimate for global grain production and stockpiles.
Harvests of all grains worldwide will come to 1.77 billion metric tons in the year through June, the council said, above its prior 1.76 billion-ton estimate. The increase reflected higher wheat, corn and barley output in North America and countries of the former Soviet Union.
The forecast “is exerting further pressure on prices,” Paul McKay, a director at Commodity Broking Services Pty, said by phone from Sydney. Agricultural commodities “are in for a bit of a major downfall. With abundant world supply, that’s what’s going to have to happen,” he said.
Wheat for March delivery fell 0.9 percent to $4.9525 a bushel in electronic trading on the Chicago Board of Trade at 2:14 p.m. Paris time. March-delivery corn declined 1.1 percent to $3.6775 a bushel.
Wheat harvests worldwide may reach 674 million tons this year, the council said yesterday, above its November forecast of 668 million tons. Stockpiles will rise to 197 million tons, it said, compared with the previous estimate of 191 million tons and 165 million tons last year.
Chicago-traded wheat futures have slid 2.9 percent this week after plunging 10 percent last week. Corn is on track for a weekly decline of 1 percent after dropping 12 percent in the preceding week.
Corn Harvest
Milling wheat for March delivery traded on Liffe in Paris gained 0.2 percent to 127.50 euros ($179.89) a ton.
The global corn crop will match last year’s 791 million-ton harvest, up from the 787 million tons forecast in November, the council said.
Soybeans for March delivery slipped 0.2 percent to $9.525 a bushel in Chicago, headed for a 2.2 percent loss this week.
Global production of the oilseed may reach a record 253.4 million tons, the U.S. Department of Agriculture said Jan. 12. Favorable planting conditions may lift Brazil’s output to an all-time high of 65 million tons, adding to a record U.S. crop, the department said. The U.S. is the world’s biggest exporter.
“We need another disaster like Argentina had with its soybean crop before they cut into the ending stocks,” McKay said. “Not that I’m wishing that on anyone.”
Argentine soybean production plunged 31 percent to 32 million tons in 2009 from a year earlier as drought curbed yields. The country is the world’s third-largest exporter of the oilseed.
Bloomberg
