Soybeans, Corn, Wheat Fall as Dollar Gains May Cut U.S. Exports

Soybeans, corn and wheat declined on speculation that a rally in the dollar will erode the appeal of commodities from the U.S., the biggest exporter of the crops.

The greenback gained as much as 0.3 percent against a basket of six major currencies before retreating, and the euro approached a nine-month low against the dollar on concern Greece’s debt burden will weigh on European economic growth. The Reuters/Jefferies CRB index of 19 commodities fell for the third time in four days.

“So much of our commodities are sold in dollar units, so if the dollar goes higher, it makes commodities more expensive for everybody buying from us,” said Tomm Pfitzenmaier, a partner at Summit Commodity Brokerage in Des Moines, Iowa. “It sounds like the Russians are going to have a good wheat crop and are going to boost their export facilities.”

Soybean futures for May delivery fell 13 cents, or 1.4 percent, to $9.50 a bushel on the Chicago Board of Trade. The price has dropped 9.4 percent this year, partly as growers in Brazil and Argentina, the two largest exporters behind the U.S., harvest bumper crops.

Corn futures for May delivery dropped 3 cents, or 0.8 percent, to $3.8325 a bushel on the CBOT. The price is down 7.5 percent this year.

Wheat futures for May delivery declined 10 cents, or 1.9 percent, to $5.0375 a bushel in Chicago. The price has fallen 7 percent this year on rising global inventories and slack demand for U.S. supplies. Both wheat and corn fell for the second time in three days.

Reduced Exports

Futures also declined after a Department of Agriculture report showed falling demand for U.S. crops, said Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa.

About 401,300 metric tons of corn were sold for export in the week ended Feb. 18, less than half the amount in the previous week, according to the report. Analysts surveyed by Bloomberg News forecast sales of 500,000 to 900,000 tons.

Sales of wheat fell 8.1 percent to about 375,700 tons, the lowest level in six weeks, the USDA said. Soybean sales totaled 239,100 tons, down 39 percent from the prior four-week average. Sales of soybean meal, an animal feed, fell 66 percent to 81,900 tons.

“Export demand is slowing” because of a stronger dollar and a faltering economic recovery, Roose said. Demand for soybean meal is falling with the reduction in the North American livestock herds, he said.

Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at a record $31.8 billion, government figures show. Wheat is the fourth-biggest crop, behind hay, with a value of $10.6 billion.

Tony C. Dreibus, Jeff Wilson
Bloomberg