June 29, 2010
CBOT corn and soy futures may advance on crop forecast
CBOT corn and soy futures, little changed, may climb after a government report showed the condition of the US crops worsened after parts of the Midwest received more than four times the normal rainfall.
Corn for December delivery on the CBOT was at US$3.535 a bushel as of 10:10 a.m. today (June 29). Tokyo time after losing for the sixth straight time yesterday (June 28), the longest slide since mid-March. Soy for November delivery added as much as 0.6% to US$9.24 a bushel and last traded at US$9.19.
About 73% of the corn was in good or excellent condition as of Sunday (June 27), down from 75% a week earlier, the USDA said yesterday (June 28) in a report. An estimated 67% of soy was given the best ratings, down from 69%.
''The worsening crop conditions have lent support to the market, while investors are staying on the sidelines to wait for a government report for crop acreages tomorrow,'' said Hiroyuki Kikukawa, general manager of research at Tokyo-based IDO Securities Co.
US farmers will plant 89.252 million acres (36.119 million hectares) with corn, according to the average estimate of 14 analysts in the survey. That is 0.5% more than farmers said they intended to plant in March and up 3.2% from 86.482 million acres in 2009. The USDA will update its crop acreage estimates tomorrow (June 30).
The area planted with soy will total 78.161 million acres, up from 78.1 million forecast in March and a 0.9% increase from last year's 77.451 million, according to the survey. Farmers are wrapping up planting of the soy crop after wet weather delayed seeding. Corn and spring-wheat seeding were completed earlier this month.
''The USDA may revise its forecast for planted acreages and stockpiles lower from its March estimates in tomorrow's report,'' Kikukawa said.
The USDA will also release quarterly estimates for grain and oilseed stocks tomorrow. Corn inventories on June 1 were 4.624 billion bushels, up 8.3% from a year earlier, according to the average estimate of eight analysts.
Soy inventories came to 592 million bushels, the analysts said. That is down 1.5% from 597 million a year earlier. The wheat surplus on June 1, before this year's harvest of winter wheat, is expected to be 940 million bushels, 41% more than the 667 million a year earlier, analysts said.
Wheat for September delivery declined 0.8 cent to US$4.615 a bushel, losing for the third straight day. It touched US$4.595 yesterday (June 28), the lowest level since June 14, on speculation that dry conditions will allow farmers to speed up the harvest in the US, the world's biggest exporter.
Approximately 38% of the winter-wheat crop was harvested as of June 27, up from 17% a week earlier and 33% a year earlier, the USDA said.
