Corn surges on export sales
U.S. corn futures settled higher Wednesday amid concerns that strong demand could shrink already tight domestic supplies.
Chicago Board of Trade corn for July delivery, the most actively traded contract, rose 18 1/2 cents, or 2.9%, to $6.58 1/2 a bushel. The December contract climbed 10 1/4 cents, or 2%, to $5.30 1/2.
Futures contracts for near-term delivery led the advances, a reflection of just how difficult it is for domestic processors to source supplies of corn in the near term.
Farmers aren't moving a lot of corn stored from last year's harvest to the market, a factor keeping available stockpiles of the grain in limited supply, said Shawn McCambridge, a senior grains analyst with Jefferies Bache in Chicago.
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"New-crop" futures--those with delivery dates such as December 2013-continue to trade at sizable discounts to nearby contracts due to the expectations for a big U.S. corn crop this year.
Farmers still have 28 million acres to plant, much of it in the upper Midwest. And with showers moving across the Midwest, there won't be much progress in the next few days, Mr. McCambridge. This will make farmers a little more patient in selling stored grain, especially with demand rising, he added.
Corn was also buoyed by a fresh export sale to China. The U.S. Department of Agriculture said China had booked orders for 360,000 metric tons of corn for delivery in the 2013-14 marketing year that starts Sept. 1. The USDA announced private exporters received an order for 180,000 tons of corn for delivery in 2013-14 to unknown destinations. Traders typically assume that such sales are destined for China.
Soybean futures ended higher, with tight domestic stockpiles continuing to buoy nearby contracts. Deferred month contracts rose as well, reflecting the uncertainty of spring plantings as rains delay the seeding of this year's crop.
CBOT soybeans for July delivery, the most actively traded contract, finished up 16 cents, or 1.1%, at $14.94 1/4. The November soybeans contract settled up 18 cents, or 1.5%, to $12.38 3/4.
U.S. wheat futures settled mixed, with concerns about winter wheat crop production potential providing price support. Spring wheat futures showed independent price strength, supported by traders unwinding previous bets on spring wheat futures climbing at the expense of winter wheat futures in Chicago and Kansas City, analysts said.
July wheat futures ended up 8 cents, or 1.2%, at $6.88 1/2 a bushel at the Chicago Board of Trade. Kansas City Board of Trade July wheat rose 4 3/4 cents, or 0.6%, to $7.43 1/4 a bushel. MGEX July wheat finished down 5 3/4 cents, or 0.7%, at $8.07 3/4 a bushel.
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(END) Dow Jones Newswires
May 22, 2013 15:19 ET (19:19 GMT)
DJ Corn Futures Jump Higher on Tight Supplies, Strong Demand->copyright
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