Wheat fell for the first time this week on speculation that rising world supplies will make up for declining output in the U.S. Great Plains, where cold and dry weather damaged crops. Corn and soybeans also dropped.
Yields in central Kansas, the biggest winter-wheat grower in the U.S., may be 43.8 bushels an acre, down from as much as 44.5 bushels last year, according to results of field samples taken on the first day of an annual tour of farms in the state. Global output may climb 3.8 percent in the 2013-2014 season as crops rebound in Europe and Russia, International Grains Council data show. The U.S. Department of Agriculture’s first production estimate is scheduled for May 10.
“There are only four weeks left to go in the marketing year” that ends May 31 in the U.S., Dave Norris, an independent grain broker in Harrogate, England, said by telephone today. “Ending stocks are going to be more than adequate at the end of the season. U.S. exports have been pretty good in the last month or two, but we’ll see that drop off once we get later into the year and Black Sea wheat becomes more competitive again.”
Wheat futures for delivery in July dropped 1.4 percent to close at $7.21 a bushel at 1:15 p.m. on the Chicago Board of Trade, after rising 5.6 percent in the previous two days. Prices are in a bear market, dropping 24 percent from a closing high on July 20. July wheat futures on the Kansas City Board of Trade fell 0.9 percent to $7.8225.
Crop-tour results were “highly variable” so far in Kansas, where the tour continues today and tomorrow, Norris said. Most of the state is experiencing moderate to exceptional drought, according to the U.S. Drought Monitor, and the Great Plains region had lower-than-normal temperatures in recent weeks, which can damage crops. Yields released yesterday for central Kansas were still higher than the first day of the tour in 2011, another year when dry weather hurt crops.
Corn and soybeans fell for a second straight session on speculation that warm, dry weather this week will firm muddy soil in the Midwest and allow farmers to accelerate planting. Rains earlier this month eased drought conditions in the region.
Rain is moving into Nebraska and western Iowa and will travel east in the next four days, halting planting temporarily, Commodity Weather Group said in an e-mailed report today. The forecaster scaled back the rain totals and expected dry weather to return through May 15. About 15 percent of the nine-state Midwest region had moderate-to-exceptional drought conditions as of April 23, down from 55 percent on Jan. 1, according to data from the U.S. Drought Monitor.
“Farmers have been planting corn very aggressively with some as much as a third completed,” Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa, said in a telephone interview. “It looks like the last of the extremely wet weather is over and it is very difficult to get bullish with increasing subsoil moisture.”
Corn futures for delivery in July declined 0.5 percent to $6.4675 a bushel in Chicago, after falling 1.5 percent yesterday to cap a 6.5 percent drop in April.
Soybeans for July delivery fell 1.9 percent to $13.73 on the CBOT, the biggest slide since March 28.