Higher Dollar, Lower Crude Pressure Grain Prices

By Benjamin Parkin Features Dow Jones Newswires

Grain futures fell on Tuesday as a higher U.S. dollar and lower crude oil prices drew investors away from agricultural commodities.

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The WSJ Dollar Index, which measures the greenback against a basket of currencies, rose 0.3% to 87.9. That made U.S. crops more expensive for international buyers. December crude oil futures fell, meanwhile, luring investors out of the commodity sector.

More generally, the positive momentum that has recently lifted prices in commodities has brought little benefit to corn and wheat markets, said Arlan Suderman, chief commodities economist at INTL FCStone Inc. It would take a significant threat to supply, such as adverse growing weather in South America, to change that.

"The grain sector needs a weather story to follow the path of the broader sector and none exists to this point," Mr. Suderman said.

Corn futures for December at the Chicago Board of Trade fell 0.1% to $3.47 3/4 a bushel, with losses limited by recent private export sales reported by the U.S. Department of Agriculture. The USDA said on Tuesday morning that exporters sold 130,000 metric tons of corn to what it called unknown destinations for 2017-18.

CBOT December wheat futures fell 0.8% to $4.27 1/4 a bushel. The USDA said that winter wheat conditions as of Sunday improved more than expected.

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Soybean futures rose. Analysts expect the USDA to trim modestly its oilseed production and stockpile forecasts for this season in a monthly supply-and-demand report later this week, even as they estimate an increase in corn figures. CBOT November oilseed contracts rose 0.2% to $9.86 a bushel.

U.S. farmers harvested 90% of their soybean crop as of Sunday, according to the agency, along with 70% of corn. Completing the soybean harvest will allow producers to increase the pace of corn fieldwork, analysts said, speeding the flow of corn into cash markets for physical grain.

Limited Midwestern rain over the next 10 days should allow farmers to make swift harvest progress, said the Commodity Weather Group in a note to clients, after a series of delays through much of this growing season.

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

(END) Dow Jones Newswires

November 07, 2017 15:40 ET (20:40 GMT)