Disappointing Exports Pressure Corn, Soybean Futures

By Benjamin ParkinFeaturesDow Jones Newswires

Corn futures sank to new lows Thursday as underwhelming export sales pressured grain-and-oilseed prices.

The U.S. Department of Agriculture said that exporters sold 954,500 metric tons of corn in the week ended Nov. 9, along with 1.177 million tons of soybeans. Both were at the low end of the range of pre-report analyst estimates. Soybean oil sales of 2,700 tons fell well below expectations.

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The lackluster pace of sales compounded concerns that U.S. merchants would fall short of this year's government export target, exacerbating domestic oversupply of crops while handing market share to rivals like Brazil and Russia.

Soybeans sales, in particular, were lagging. Last year the U.S. was 15% ahead of the current sales pace, said Brian Hoops of Midwest Market Solutions.

"There's still time, but the closer we get to South American harvest without a serious weather problem, the more challenging it will be to make up the gap," Ken Morrison, a trader and author of a commodity newsletter, wrote in a note to clients. "I'm beginning to see even the most ardent bulls on soybean exports raising the concern."

Corn and soybean prices gave back overnight gains after the export sales report was released on Thursday morning. December corn futures fell 0.5% to $3.36 1/2 a bushel at the Chicago Board of Trade, falling to the lowest close since late August. January soybean contracts dropped 0.4% to $9.72 a bushel.

Front-month wheat futures rose. CBOT December wheat contracts climbed 0.4% to $4.21 1/2 a bushel. Traders have played wheat prices against corn and soybeans multiple times this week, with contracts moving in opposite directions.

Private forecaster Informa Economics estimated that U.S. farmers would plant 91.4 million acres corn in 2018, higher than its previous figure of 90.4 million, according to market observers. Informa cut its soybean acreage estimate to 89.6 million, they said.

With U.S. farmers in the final stages of a bumper corn and soybean harvest, analysts said there was little prospect of easing pressure on prices without a change to the global supply outlook.

"To really begin shifting market psychology, we are going to need a disruptive weather event somewhere in the world," said Dan Hueber, general manager of the Hueber Report.

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

(END) Dow Jones Newswires

November 16, 2017 16:34 ET (21:34 GMT)