August 13, 2008

CBOT Traders: USDA report seen as bearish for corn

The US Department of Agriculture's August crop production and supply/demand reports are seen as bearish for Chicago Board of Trade corn futures, friendly for soy and neutral for wheat, traders said Tuesday (August 12).

CBOT corn futures are called to open 10-15 cents per bushel lower, soy are seen starting 5-7 cents higher, and wheat is expected to open 2-4 cents higher, traders said.

The biggest surprise in the reports was the USDA's increased estimates for 2008-09 US corn production and yield, traders said. The USDA predicted a corn crop of 12.288 billion bushels, above the average analyst estimate of 11.938 billion and the agency's July estimate of 11.715 billion.

"That's a big corn crop," a CBOT floor trader said. "We had a big break in the market, but still that's big."

The estimate for US soy production was below the average analyst estimate, although the market could feel some downward pressure from a setback in corn, traders said.