Corn rose for a third session in Chicago as a government report showed U.S. inventories will remain at a 17-year low on increasing use of the grain in livestock feed. Soybeans and wheat advanced.
U.S. corn stockpiles before the next harvest will be 632 million bushels, the Department of Agriculture said March 8, leaving its forecast unchanged at the lowest since 1996 even as analysts predicted a climb to 646 million bushels. The USDA raised its forecast for corn use in animal feed to 4.55 million bushels, from 4.45 million bushels. Corn stockpiles worldwide will drop to 117.5 million metric tons, smaller than the 118 million tons predicted last month.
“Adjustments look bullish, as U.S. corn stocks remained unchanged, against higher stocks estimated by analysts,” Arnaud Saulais, a broker at Starsupply Commodity Brokers in Nyon, Switzerland, said today in an e-mailed report. “Low-priced wheat was thought to be displacing corn feed for livestock.”
Corn for delivery in May gained 0.4% to $7.0625 a bushel by 7:39 a.m. on the Chicago Board of Trade, after climbing 2.2% in the previous two sessions. Soybeans for the same delivery month rose 0.4% to $14.765 a bushel. Both crops surged to records last year in Chicago trading because of the worst U.S. drought since the 1930s.
World soybean harvests will total 268 million tons, 1.5 million tons smaller than February’s estimate, as the production outlook was lowered for Argentina, according to the USDA. The Argentine crop, the third-largest globally, will be 51.5 million tons, down from 53 million tons forecast last month, it showed. The outlook for U.S. inventories was unchanged at 125 million bushels, the lowest since 2004.
“Prices are rising as stockpiles from the current crop decline,” Makiko Tsugata, an analyst at Market Risk Advisory Co., said today. “The downward revision of the USDA estimate on Argentina’s production is also a strong factor pushing prices higher over the short term.”
Wheat for delivery in May rose 0.2% to $6.9825 a bushel. In Paris, milling wheat for the same delivery month climbed 1% to 232.50 euros ($302.17) a ton on NYSE Liffe.