Chicago corn futures were set on Friday for their biggest weekly climb in 10 years as prices extended a rally fueled by a U.S. government report showing lower-than-expected plantings and dry weather curbing yields.
Soybeans and wheat were poised to end the week higher for the first time in four weeks.
“The focus now returns to drying north-west of the U.S. Midwest,” said Tobin Gorey, director of agricultural strategy at Commonwealth Bank of Australia.
“That area is trending drier. A couple of rain events are likely over the next week… forecasters though are offering no comfort that the rain will arrest a drop in yields in that area. The amount of rain from these events will obviously be closely watched.”
The most-active corn contract on the Chicago Board of Trade (CBOT) rose 0.5% to $5.91-3/4 a bushel by 0317 GMT. The market has gained almost 14% this week, the biggest since April 2011.
Soybeans have climbed more than 10% this week, while wheat is over 4% – both up after three consecutive weeks of losses.
The U.S. Agriculture Department (USDA) said on Thursday soybean export sales totalled 1.763 million tonnes in the week ended June 24, the most since the week ended Jan. 21. It was also near the high end of forecasts for 900,000 tonnes to 2.3 million tonnes.
On Wednesday, corn futures climbed by their daily exchange-imposed limit after the USDA pegged plantings of the crop at 92.692 million acres, below an average trade expectation of 93.787 million.
The agency said soybean plantings totalled 87.555 million acres, compared to analysts’ expectations for 88.955 million.
Brazil is seen producing a total of 87.93 million tonnes of corn in the 2020/2021 harvest, down from a previous forecast of 89.68 million tonnes, a consultancy said on Thursday.
The second corn crop in Brazil, which is battling drought and now frosts, is now seen at 60.45 million tonnes, compared with a previous estimate of 62 million tonnes, StoneX said.
However, Ukraine’s 2021 grain harvest could reach record volumes above 75 million tonnes thanks to favorable weather, Ukrainian agriculture officials, weather forecasters and analysts said.
Commodity funds were net sellers of CBOT wheat, soybean, corn and soyoil futures contracts on Thursday, traders said. They were net buyers of soymeal futures.
Source: Reuters (Reporting by Naveen Thukral; Editing by Subhranshu Sahu)