Corn, Wheat Drop for Second Day Before Global Supply Report

Corn and wheat futures declined for a second day, while soybeans were little changed, as investors and importers refrained from purchases before the release of U.S. estimates on global agricultural supply.

Corn for July delivery fell 0.7 percent to $3.68 a bushel in after-hours electronic trading on the Chicago Board of Trade at 2:23 p.m. Singapore time, and wheat lost 0.4 percent to $4.91 a bushel. Soybeans were little changed at $9.6050 a bushel.

The USDA may pare its estimate of global corn stockpiles to 137.13 million tons before the next harvest, from 144.2 million tons a month earlier, according to the average estimate of 12 analysts surveyed by Bloomberg News. The USDA will release its latest forecast on global supply and demand later today in Washington.

“People are just waiting for the USDA report,” and holding off purchases, said Michael Pitts, commodity sales director at National Australia Bank Ltd. Trading volume may remain thin until the reports are released, he said.

Wheat stockpiles may climb to 197.69 million tons, the highest level since 2001-2002, from 165.23 million tons a year earlier, according to the average estimate of 12 analysts surveyed by Bloomberg News. That compares with an estimate by the U.S. Department of Agriculture for end-of-season stocks of 195.82 million tons.

Soybean Inventories

Global soybean stockpiles may be at 66.97 million tons before next year’s harvest, according to the average estimate in the Bloomberg survey. That compares USDA’s April forecast of 62.96 million tons, and 42.8 million tons of global inventories a year earlier.

Soybean imports by China, the world’s biggest buyer, may jump to a record 46 million tons in 2009-2010, as shipments in the next three months are expected to surge, the China National Grain and Oils Information Center said. That compares with a USDA estimate of 43.5 million tons in April.

Imports in June may reach a record 6 million tons after exceeding 5 million tons in May, the state-backed market information provider said in an e-mailed daily report, citing its monitoring of shipments. June’s imports may jump partly because of delays to cargoes booked in previous months, it said.

There’s “no question China’s strong buying is supporting Chicago prices,” said Li Zhao, manager at Yongan Futures Co., by phone from Hangzhou.

China sold 85 percent of the 574,600 tons of corn offered at tender today at an average price of 1,870 yuan per ton, the National Grain & Oil Trade Center said on its website.

Luzi Ann Javier
Source: Bloomberg