Grain, Soybean Futures Drift Lower

By Benjamin Parkin Features Dow Jones Newswires

Grain and soybean futures fell ahead of a government crop report due later this week.

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Traders are waiting for the U.S. Department of Agriculture to release on Thursday updated production estimates for the ongoing U.S. corn and soybean harvest. Though rain in the Midwest has slowed the pace of fieldwork, early results so far show better than expected corn and soybean yields.

That's giving traders little incentive to bet that prices will rise ahead of the report, particularly given some improvement in weather forecasts and recent pressure on exports from a steady to higher dollar.

Wheat futures led losses on Monday. Weakness in the Russian ruble--which is testing its 50-day moving average against the dollar--added to the pressure on that market, said Mike Zuzolo, president of Global Commodity Analytics & Consulting in Atchison, Kansas. Russia is the U.S.'s principal competitor in exporting the grain, and a weaker currency makes its crop more competitive.

That prompted traders to liquidate bets that wheat prices would rise, Mr. Zuzolo said. December wheat contracts at the Chicago Board of Trade fell 1.7% to $4.36 a bushel.

CBOT December corn futures fell 0.1% to $3.49 1/2 a bushel while November soybean contracts slid 0.6% to $9.66 3/4 a bushel.

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Analysts surveyed by The Wall Street Journal expect the USDA to leave its corn and soybean production and yield forecasts little changed on Thursday from last month.

They expect the agency to lower slightly expected corn production to 14.168 billion bushels with a yield of 169.7 bushels per acre. Average estimates put the expected soybean bounty at 4.439 billion bushels, slightly higher than last month, alongside an oilseed yield of 49.8 bushels per acre.

Analysts said corn and soybean prices could potentially get a boost from dry weather in parts of Brazil, which is delaying plating activity. Rain is needed to ease stress on corn and soybeans in the north of the country particularly, said the Commodity Weather Group in a note to clients.

Write to Benjamin Parkin at benjamin.parkin@wsj.com

(END) Dow Jones Newswires

October 09, 2017 15:46 ET (19:46 GMT)