Grain futures mixed, corn hovers near 4-1/2- month high on strong US exports data

Grain futures were mixed on Thursday, corn traded close to the strongest level in almost five months on signs demand for US supplies has increased. Meanwhile, wheat touched a two-month high, while soybeans traded little changed.

On the Chicago Board of Trade, corn futures for March delivery traded little changed at $4.5313 a bushel by 14:55 GMT, after yesterday they touched $4.5438 a bushel, the strongest since September 30. Futures hit a session high at $4.5388 per bushel, while day’s low was touched at $4.5125 per bushel. Corn has advanced 7.3% this year after it lost nearly 40% in 2013, the steepest annual drop on record and the worst annual performance since at least 1959.

The US Department of Agriculture reported on February 18 that inspections of US corn ready for shipment more than tripled to 827 610 tons in the week ended February 13, from a year earlier.

According to data by the US Commodity Futures Trading Commission, hedge-fund managers and other large market players switched to a net-long position in corn futures for the first time in almost eight months. Investors take a net long-position, when they expect higher prices.

“The dry conditions that hurt soybeans are also impacting corn,” Vanessa Tan, an investment analyst at Phillip Futures Pte, said in a Bloomberg interview from Singapore yesterday.

DTN.com reported on February 19 that rainfall is still needed to support filling corn and soybeans in southern Brazils key growing areas of Rio Grande do Sul, after the prolonged period of hot and dry weather conditions. The latter diminished soil moisture and probably harmed some of the corn and soybeans crops. Showers in Parana and Sao Paulo may favor filling crops, but will hinder early harvests of maturing crops.

Meanwhile, soybeans and corn producing regions in Argentina will benefit from adequate to surplus soil moisture, except some areas where recent heavy storms have caused serious flooding. Scattered showers and thundershowers today and on Thursday will maintain soil moisture and will be beneficial for most of the crops, the website reported.

Elsewhere on the grains market, soybeans futures for settlement in March traded little changed at $13.5475 per bushel by 15:01 GMT. Yesterday, prices touched a session high at $13.7138 per bushel, the strongest level since September 16. Futures touched a session high at $13.6112, while day’s low stood at $13.4388 per bushel. The grain settled last week 0.5% higher, after adding 3.7% in the previous 5-day period. However, the oilseed has lost 8.5% in 2013.

Wheat touches a two-month high

On the Chicago Board of Trade, wheat futures for settlement in March added 0.78% to trade at $6.1538 per bushel by 15:04 GMT. Prices touched a session high of $6.2075 per bushel, the strongest level since December 19, while day’s bottom was touched at $6.1488.

The grain settled last week 4.1% higher, the biggest gain since the period ended September 27. However, wheat slumped 22% last year, marking the largest annual decline since 2008, on expectations for a record global output of 712.7 million tons, according to data by the US Department of Agriculture.

DTN’s February 19th forecast called for a new storm system to leave first rain, which will later change into snow, accompanied by strong winds over the Midwest. Warm weather and rain may melt the protective snow cover in the soft red winter wheat areas of the Midwest, after which the cold temperatures that follow may harm some crops.

Meanwhile, the website reported that in the Southern Plains a return to colder weather is expected in the north and east US region in the next six-to-ten-day period. The cold air will probably remain outside the Plains’ wheat belt, but should be watched closely.