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U.S. corn and soybean futures dipped to new three-year lows Wednesday, while rose in short covering ahead of reports from the U.S. Department of Agriculture and Statistics Canada.
Chicago corn prices slid, as traders said weather charts showed a hot, dry spell in Argentina will give way to widespread rain in the coming days, while anticipated rain in major Brazilian growing areas adds to expectations of large soybean supplies.
CBOT corn (C_1:COM) for March delivery closed -0.9% to $4.34 3/4 per bushel, and March soybeans (S_1:COM) settled -0.8% to $11.89 3/4 per bushel, but wheat (W_1:COM) for March delivery ended +1% to $6.00 3/4 per bushel.
ETFs: (NYSEARCA:CORN), (NYSEARCA:SOYB), (NYSEARCA:WEAT), (DBA), (MOO)
The market moves show how market participants are shifting focus back toward forecasts of a glut of grain and oilseed production this year, Consus Ag Consulting’s Karl Setzer told Reuters.
“Right now, we don’t have a poor demand market,” Setzer said. “We have is a supply problem. We are over-producing for what the world needs.”
Traders will be paying particularly attention to Brazilian agency Conab’s update of the country’s official production estimates, Setzer said, after the USDA last month reported larger than expected Brazilian crops, as well as bigger U.S. yield and production levels for the recently harvested crop.
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