By Jae Hur
Sept. 4 (Bloomberg) -- Corn and soybeans are poised for weekly declines on forecasts that rain last month will allow farmers in the U.S. Midwest to produce more of the crops than the government forecast.
Before today, corn fell 4 percent this week and the oilseed slumped 6.9 percent. U.S. corn output will total 13.01 billion bushels, Informa Economics Inc. said yesterday. The Department of Agriculture forecast 12.761 billion last month, up from an estimated harvest of 12.101 billion last year.
“Informa’s bearish supply forecasts were a weight on the Chicago grains and oilseeds, but at this stage the market should be well aware of the bountiful new crop supply,” said Toby Hassall, a research analyst at CWA Global Markets Pty in Sydney.
Corn for December delivery fell as much as 0.6 percent to $3.1375 a bushel in electronic trading on the Chicago Board of Trade by 4:37 p.m. in Singapore. The price touched $3.115 yesterday, the lowest since Aug. 17.
Soybeans for November delivery were little changed at $9.41 a bushel. Prices reached $9.295 yesterday, the lowest level since July 30.
The soybean crop will total 3.305 billion bushels and could reach 3.372 billion with favorable September weather, Informa said. The USDA is estimating a crop of 3.199 billion bushels and is scheduled to release its second survey-based production forecast on Sept. 11.
Inventories, Demand
“Very tight inventories and voracious Chinese import demand will makes soybeans very sensitive to any adverse late- season weather events,” CWA’s Hassall said.
U.S. exporters sold 110,000 metric tons of soybeans to China and 174,000 tons of corn to unknown buyers for delivery in the marketing year that ends Aug. 31, the USDA said yesterday.
China’s soybean output in 2009-2010 may fall by 14.8 percent to 14.05 million metric tons on adverse weather conditions, Li Qiang, chairman of Shanghai JC Intelligence Co., said today at a Beijing conference.
Wheat for December delivery in Chicago fell 0.1 percent to $4.7825 a bushel at 4:38 p.m. Singapore time. The price touched $4.7525 yesterday, the lowest level since Dec. 5. Before today, the grain had lost 3.3 percent this week.
Grain crops in Australia’s New South Wales, usually the nation’s second-largest wheat producer, may fail after rain forecast this week missed many areas. The state was forecast to produce 6.8 million tons of wheat, 1.6 million tons of barley and 321,000 tons of canola this season.
‘Pretty Disappointing’
Rainfall in the past two days was “pretty disappointing,” Frank McRae, grains specialist at the state’s Department of Industry and Investment, said today. As much as 30 percent of the winter crop, including wheat, barley and canola, may be in “dire straits,” he said.
Hot, dry weather in eastern parts of Australia and the forecast return of an El Nino has raised concerns that the nation’s grain output may miss forecasts. The country, the world’s fourth-largest wheat exporter, relies on rain in September to boost yields ahead of the harvest from November.
To contact the reporter on this story: Jae Hur in Singapore at jhur1@bloomberg.net
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