Grain futures mixed, soybeans en route to best week in a year as unplanted soybean areas grow

Soybeans are poised to post their best weekly performance in more than a year amid dry weather and as the USDA reported that unplanted areas, which were originally planned for soybean planting, increased. Corn declined, while wheat erased prior daily losses.

On the Chicago Board of Trade, soybeans for delivery in September traded at $12.8788 a bushel at 11:20 GMT, down 0.09% on the day. Prices held in range between days high and low of $12.9538 and $12.8525 per bushel respectively. The oilseed rose to a three-week high on Thursday and settled the day 1.61% higher, extending current weeks advance to over 5.6% after gaining 0.6% the preceding five-day period.

Soybeans are set for a best week since 2012 as the U.S. Department of Agriculture reported that 1.619 million acres of land that was poised to be sown to soybeans remained unplanted, well above last years 159 579 acres. Meanwhile, Commodity Weather Group said yesterday that dryness will keep lowering corn and soybeans yield potential in the affected areas. Little or no rain has fallen in the last two weeks in Iowa and Illinois, the top corn growing states.

Joyce Liu, an investment analyst at Phillip Futures Pte Ltd.: “We still have haunting memories of U.S. Midwest crops from last year. If you have dry weather again, then it can be worrying.”

Soybeans advanced throughout the week after the U.S. Department of Agriculture trimmed its soybean production forecast to 3.255 billion bushels on Monday, 5% below July’s 3.42 billion estimate. Yields expectations were also reduced and now stood at 42.6 bushels per acre, below the previous reading of 44.5 bushels and analysts’ projections for a 43.6 output per acre.

Meanwhile, corn fell more than 1% on the day. The September contract plunged to $4.7638 per bushel at 11:12 GMT, down 1.04% on the day. Prices ranged between days high and low of $4.8375 and $4.7563 a bushel respectively. The grain settled at $4.8140 per bushel on Thursday, the highest since August 1, rising 3.77% on the day and extending current weeks advance to over 2.4%.

The USDA trimmed its U.S. corn output forecast to 13.763 billion bushels on Monday, 1.3% below its July estimate at 13.950 billion and also less than the 14.036 billion forecast by a Bloomberg survey. Yields are also expected to be lower with the government agency cutting its expectations for 154.4 bushels per acre, which is below last month’s estimate at 156.5 bushels and analysts’ expectations for a 157.7 bushels-per-acre yield. Stockpiles are also poised to drop and will equal 1.837 billion bushels, 6% below July’s 1.959 billion projections.

Meanwhile, wheat erased previous daily losses and rose to $6.3700 a bushel at 11:18 GMT, up 0.06% on the day. The grain ranged between days high and low of $6.4113 and $6.3475 per bushel respectively. Futures surged 1.15% on Thursday, adding to current weeks advance of 0.5% so far.

Wheat was pressured throughout the week as the USDA kept its U.S. wheat crop forecast unchanged at 2.114 billion bushels, while global production is still expected to reach an all-time record high of 705.4 million tons. However, the grain received a little boost as the USDA reported that spring wheat harvesting fell well behind last year’s pace. As of August 11, only 6% of the spring wheat crop was reaped, compared to the five-year average pace of 24% and last year’s 61% during the comparable week. However, winter wheat harvesting was 1% above the average speed at 92% and 2% below last year’s 94%. An advance of 5% from the preceding week’s 87% was made.