Grain futures edge lower

Grain futures fell on Wednesday with corn and soybeans slipping slightly, while wheat made a moderate fall. Corn rebounded from Tuesdays 34-month low on speculation low prices may spur demand before USDAs crop production report on August 12.

On the Chicago Board of Trade, corn futures for September delivery traded at $4.7213 a bushel at 8:48 GMT, down 0.06% on the day. Prices ranged between days high and low of $4.7488 and $4.7163 a bushel respectively. The grain rebounded from Tuesdays low of $4.55 per bushel, the lowest since October 4, 2010, and settled the day 0.72% higher. The contract has declined 0.8% so far this week after erasing 12.6% in the previous two five-day periods.

Faiyaz Hudani, an analyst at Kotak Commodity Services Ltd., said for Bloomberg: “The low of $4.55 should act as a support level. A relief rally for a week or so may be witnessed, it depends on how the USDA data comes on Monday. If the data is a little bit supportive, we’re looking at a bounce back.”

Corn continued to mark new multi-month lows as the U.S. Department of Agriculture said in its weekly crop progress report on Monday that corn silking advanced from last week and is nearing the five-year average pace. Silking is part of the pollination stage, during which the crop can be hurt by drought and high temperatures. Weather forecasters have been calling in the last couple of weeks for cool and rainy weather across U.S. growing areas, which is supportive for both corn and soybeans growing.

The USDA said in its report that as of the week ending August 4, 86% of the corn plants were in the silking stage, compared to 71% a week earlier. This was near the five-year average of 89%, but below last year’s reading of 98%.

According to a Bloomberg survey, farmers may reap a record 14.036 billion bushels of corn this year, 30% more than last year’s production. The USDA will publish a revision of its projections at noon on August 12. The government agency trimmed its latest output projection to 13.95 billion bushels, down from 14.005 billion, but that was however still an all-time record high.

Soybeans slightly decline

Soybeans remained fairly unchanged on Wednesday near Mondays 17-month low. The September contract fell to $11.9325 a bushel at 9:31 GMT, down 0.08% on the day. Prices held in range between days high at $11.9975 and low of $11.9263 a bushel respectively. The oilseed fell 1.20% on Tuesday, an eleventh consecutive daily decline, extending current weeks fall to over 1.5% after shedding 19.2% in the last two five-day periods.

The USDA said in its Monday report that as of August 14, 79% of the soybean plants had bloomed, up from 65% in the previous week and nearing the five-year average of 85%. During the comparable week a year earlier, 93% of the soybean crop was in the blooming stage.

As for the crop condition, the government agency said quality was almost the same as the previous week but marked a large improvement compared to the previous season. As of August 4, 9% of the soybean plants were categorized as “Very poor” and “Poor”, compared to 39% in 2012. Meanwhile, 27% of the crop was of “Fair” quality, below last year’s 32%. As for the premium quality, 64% of soybeans were rated good-excellent, well above last season’s 29% during the comparable week.

Soybeans tumbled 3.7% in July, marking a second monthly decline in a row. The USDA will reassess its crop forecast on August 12. Its previous forecast was for a jump in domestic output by 13% to a record 3.42 billion bushels, which would boost global inventories by 20% to an all-time record high of 74.1 million tons. The grain was well supported by favorable weather conditions in U.S. growing areas, which led to an almost 20% decline since the week beginning July 21.

Wheat falls as well

Wheat also marked a daily decline today and fell to $6.4850 a bushel at 9:27 GMT, down 0.32%. Prices ranged between days high and low of $6.5288 and $6.4800 a bushel respectively. The grain surged 0.74% on Tuesday after slipping 2.27% on Monday. The September contract has declined 1.8% so far this week after it gained 1.69% the previous one.

The USDA reported on Monday spring wheat heading advanced to 97% last week, 3% above the preceding week’s pace and 1% below the five-year average of 98%. During the comparable period in 2012, 100% of the crop was headed.

As for the wheat condition, its moderately better than last season’s crop. As of August 4, 7% of the spring wheat was categorized as “Very poor” and “Poor”, compared to 11% a year earlier. Plants in the “Fair” category were 1% less than in 2012, standing at 25%. As for the top quality, 68% was rated good-excellent, above last year’s 63% during the comparable week.