Chicago wheat futures resumed decline on Monday, erasing a climb in the previous session, as the beneficial rain in Russia and Ukraine may lift crops prospects. Corn surged to a fresh 2-year high during the overnight session, but failed to hold on to it. Soybean ended a tad higher.
December corn declined 9 cents, or 1.7 percent, to 5.1275 dollars per bushel. December wheat lost 13.5 cents, or 1.9 percent, to 7.065 dollars per bushel. November soybean added 2.5 cent, or 0. 2 percent, to 11.285 dollars per bushel.
“Grain prices closed under pressure this afternoon, the pressure was primarily from the wheat complex reacting to news from Russia that they are once again considering wheat exports before the end of this year, there are also reports of beneficial rainfall expected in the growing areas of Ukraine and Russia, one and half to two inches of rainfall is expected, which will help new crop planting. The planting dates for ideal planting are from October 1. to October 10,” said Steve Erdman, a managing member at new world trading.
Corn rallied during overnight session and once hit 5.2875 dollars per bushel, the highest price for front-month contract since September 2008, buoyed up by a weaker dollar. But the price gradually fell back after the opening, as the dry weather in U.S. Midwest this week will aid farmers to accelerate their harvest process.
USDA announced an export sale of 108,712 tons of corn to Japan for delivery in 2010/11 marketing year. But last week’s corn export inspection only reached 34 million bushels, which is the second week in a row that inspection has failed to meet USDA’s average projection for current export.
“The corn market is expected to stay in a volatile trading affair over the next 5 days as the market is fearful of some of the extent of long positions by the index funds. Index funds have record positions of anywhere from 435,000 to 485,000 contracts. Many traders concerned that they may see a similar affect that they saw in liquidation of the energy positions in 2008,” said Steve Erdman. “This is a very different market in the grains, because of these fund positions and the fear that they may come in with even additional funding to boost their long positions.” (PNA/Xinhua)