Corn (CBOT:ZCN14) dropped to the lowest level in almost four years in Chicago on expectations that a record crop in the U.S., the biggest exporter, will boost global supplies. Soybeans (CBOT:ZSN14) headed for the longest run of losses since 2009.
Corn entered a bear market this month as most U.S. crops developed in good condition amid ample rain and a government report showed inventories on June 1 were larger than expected. Farmers may harvest a record 13.93 billion bushels, according to a Bloomberg survey before the U.S. Department of Agriculture updates its forecast for domestic production on July 11.
“Huge yield discussions continue, and with the current weather pattern in place, you can’t really argue with it,” Graydon Chong, an analyst at Rabobank International in Sydney, said by telephone. “We’re continuing to see markets slip.”
Corn for delivery in December fell 0.6 percent to $4.0175 a bushel by 7:11 a.m. on the Chicago Board of Trade after touching $4.015, the lowest for a most-active contract since August 2010. Seventy-five percent of the crop in main U.S. growing areas was in good or excellent condition as of July 6, USDA data show.
Soybeans for delivery in November slid 0.6 percent to $11.10 a bushel after reaching $11.0675, the lowest since December 2011. Prices are set to decline for an eighth day, the longest slump since February 2009. Seventy-two percent of the U.S. crop was in top condition, according to the USDA.
Temperatures in the U.S. Midwest through at least next week probably will be low enough to prevent any damage to corn crops entering the reproductive phase, forecaster DTN said. Scattered showers also will maintain adequate soil moisture, according to the report today.
Wheat (CBOT:ZWN14) for delivery in September declined 0.5 percent to $5.5325 a bushel, heading for a third straight drop. In Paris, milling wheat for delivery in November slid 0.3 percent to 182.75 euros ($248.63) a metric ton on Euronext, trading near the lowest level since January.
World inventories of wheat at the end of the 2014-15 season may be 188.76 million tons, according to Bloomberg’s survey before the USDA releases estimates July 11. That’s similar to last month’s forecast and a three-year high. Farmers are harvesting crops in the U.S. and Europe. Fieldwork was expected to slow this week because of rains in countries including France, Europe’s biggest grower.
“We expect markets to be quiet,” Arnaud Saulais, a broker at Starsupply Commodity Brokers in Nyon, Switzerland, said by phone today. “There is still a lot of harvest pressure, even if at the moment there are slowdowns due to the bad weather in France. Traders will be waiting for the next USDA report.”