Grain futures mixed as rain seen disrupting harvest

Grain futures were mixed on Monday with wheat and corn advancing, while soybeans marked a minor decline after hitting a 1-week high earlier in the day as rains in the Midwest were expected to disrupt the harvest.

On the Chicago Board of Trade, soybeans futures for November settlement slipped 0.31% to $12.9138 per bushel at 13:55 GMT. Prices held in range between days low of $12.8963 and a one-week high of $13.0475 a bushel. The oilseed rose by 0.7% on Friday but settled the week 1.8% lower.

Soybeans were supported on Monday as rains in the Midwest were expected to delay the harvest, leaving crops vulnerable to cold damage and yield losses. According to National Weather Service data, rain in Indiana, Iowa, Illinois and Minnesota topped 2.5 centimeters last week. DTN reported on Friday that rain and some snow in the Northern Plains and western Midwest will delay the harvest. Meanwhile, showers and thunderstorms in the east during the weekend would also disrupt harvesting.

According to USDAs crop progress report last Monday, 11% of soybeans were reaped as of September 29, marking a 3% advance from the preceding week.

Meanwhile, Informa Economics Inc. in Memphis, Tennessee, cut its soybean harvest outlook by 1.5% to 3.176 billion bushels, above the total of 3.161 billion bushels predicted in a Bloomberg survey. The U.S. Department of Agriculture will update its September forecast of 3.149 billion on October 11.

Chris Gadd, an analyst at Macquarie Group Ltd., said for Bloomberg: “There is potential risk to the upside for soybean prices. The market will need to add a level of risk premium to reflect the uncertainty that remains for U.S. production and the delays to plantings being seen in Brazil.”

Elsewhere on the market, corn futures for delivery in December rose by 0.77% to $4.4663 per bushel at 13:55 GMT. Prices held in range between days high and low of $4.4688 and $4.4163. The grain rose for the first day in six on Friday and settled the week 2.3% lower after adding 0.5% in the preceding five-day period.

A Bloomberg survey before USDAs forecast update on October 11 showed that U.S. production may stand at 13.836 billion bushels, below USDAs September 12 estimate of 13.843 billion. However, this would still be an all-time record high and 28% higher than last years drought damaged crop. Stockpiles are expected to have surged to 1.936 billion bushels according to the poll, above the 1.855 billion bushels the government agency last predicted.

Meanwhile, wheat futures for settlement in December rose by 0.80% to $6.9313 per bushel at 13:54 GMT. Prices held in range between days high and low of $6.9388 and $6.8650 a bushel respectively. The grain fell by 0.3% on Friday after advancing for three straight days but settled the week 0.8% higher.

Wheat was well supported in recent session on speculations that heavy rains in the Black Sea Region will curb harvests, boosting demand for the U.S. crop. Ukraine’s national weather center in Kiev said on September 27 that the nation’s winter-wheat planting may be 30% lower than expected following record rainfall. At the same time in Russia, the area sown to wheat may be as low as 13 million hectares, down from the projected 16.4 million.

DTN reported on October 4 that drier and windy conditions in the Southern Plains may increase stress to newly emerged wheat. Unfavorable conditions were predicted to extend into the first half of this week.