Corn Posts Longest Slump Since 2010; Soybeans Enter Bear Market
Corn fell for an eighth session in Chicago, capping the longest losing streak since March 2010, as prospects improved for crops in South America. Soybeans slumped into a bear market.
Corn and soybean growing areas in Argentina may receive moderate to heavy rainfall from storms beginning Feb. 16, easing dry conditions, DTN said today in a forecast. Northern crop regions in Brazil will be drier, helping the harvest progress, according to the report. Argentina, the largest corn exporter after the U.S., may produce 27 million metric tons, more than expected by analysts, the U.S. Department of Agriculture said Feb. 8. Brazil’s harvest may be 72.5 million tons, also more than expected, the USDA said.
“The South American outlook is looking a bit brighter,” Kieran Walsh, a broker of agricultural derivatives at Aurel BGC, said today from Paris. “Yield potential in both Argentina and Brazil is looking healthier, reinforcing the USDA numbers.”
Corn futures for delivery in March dropped 0.9 percent to close at $6.9625 a bushel at 2 p.m. on the Chicago Board of Trade. Earlier, the grain touched $6.915, the lowest for a most- active contract since Jan. 11.
Soybean futures for delivery in May fell 0.5 percent to $14.095 a bushel in Chicago. The price has dropped 20 percent from the record settlement of $17.6825 on Sept. 4, tumbling into a bear market.
Warming equatorial waters in the Pacific Ocean are increasing precipitation in South America and the U.S., a major change from dry conditions of the past three months, Martell Crop Projections said in a report. Soybean crops in Brazil and Argentina will jump 28 percent to a record 136.5 million tons this year, the USDA forecast last week.
“Perceptions that global weather conditions are improving are keeping buyers on the sidelines,” Chad Henderson, the president of Prime Agricultural Consultants Inc. in Brookfield, Wisconsin, said in a telephone interview. “It’s not too late to add bushels to the South American crops, and rain in the U.S. will reduce drought conditions ahead of planting.”
U.S. corn output is projected to increase 34 percent to 14.4 billion bushels in the 2013-14 season, the USDA said yesterday in a 10-year forecast. Soybean production may climb 11 percent to 3.34 billion bushels, it said. Both crops rallied to records last year in Chicago trading, as drought in the U.S. followed dry weather in South America in the previous season.
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