Grain futures mixed, wheat loses ground amid record-high grain output

Grain futures were mixed on Monday, with wheat losing ground as a record-high output is expected. Meanwhile, corn and soybeans advanced.

Wheat futures for settlement in March traded at $6.5013 per bushel by 15:39 GMT, losing 0.2% on daily basis. Prices jumped to a session high of $6.5712, while day’s low was touched at $6.5012 per bushel. The grain lost 2.6% last week, snapping two five-day periods of advances of 3.0% and 0.82%, respectively.

Wheat plunged 16% this year as the US government estimated global output will reach a record-high boosted by increased harvests in Canada and Russia.

The International Grains Council predicted global wheat output will surge 6.6% to 698.4 million tons in the 2013-14 season. However, according to the same organization, imports will also increase to 142.3 million from 140.8 million on increased demand by China and Egypt.

Kona Haque and Chris Gadd, analysts at Macquarie Group Ltd. wrote in a report, cited by Bloomberg, that import demand for wheat “is still strong and the hard-red winter markets should see resurgent demand from South America in coming months. We advocate being long U.S. hard-red winter wheat at the present.”

Bangladeshs Food Planning & Monitoring Unit reported that shipments into the country increased by 46% from a year ago and reached 1.15 million tons during the July 1st – November 28th period.

According to data by the U.S. Commodity Futures Trading Commission, large speculators on the grains market reduced bets on lower wheat prices in the week ended December 3rd.

DTN’s December 6th weather forecast called for sharply colder weather in the Midwest during the next few days. In the Southern Plains the weather during this week will be much colder, but probably not cold enough to harm wheat at this date. However, the area from northeast Colorado and northwest Kansas to southwest Nebraska may be somewhat at risk, depending on snow cover and exactly how cold it gets.

Meanwhile, corn for March delivery rose by 0.18 percent to $4.3538 a bushel by 15:32 GMT. Futures held in range between day’s high and low of $4.3712 and $4.3362 per bushel, respectively. Corn added 2.26% last week, after a gain of 0.74% in the previous two 5-day-periods.

Soybeans up as well

Elsewhere on the grains market, soybeans futures for settlement in January traded at $13.3988 per bushel by 15:35 GMT, adding 1.03% on daily basis. Prices jumped to a session high of $13.4412, while day’s low was touched at $13.2462 per bushel. The grain snapped two weeks of advances by losing 0.85% last week. In the preceding two five-day periods soybeans added 1.34% and 3.11%, respectively.

Traders awaited the release of the USDA report on soybeans demand and supply for December, due tomorrow. Analysts projections show that the agency may increase its forecasts for Argentina and Brazils soy crops.

DTN reported that in Brazil scattered showers will favor developing corn and soybeans during the next five to seven days. Hot temperatures will be brief during this period. There is some risk to the harvest of wheat in the south, which will in turn delay the final planting effort for soybeans after the wheat harvest.