Soybeans tick up ahead of USDA data
U.S. soybean and grain futures edged higher Wednesday after wobbling near flat in intraday trade, as the markets continued to consolidate ahead of a key government crop report.
The U.S. Department of Agriculture is expected to trim forecasts for soybean and corn output in a monthly supply-and-demand report due Thursday at noon EDT, after a spate of hot, dry weather in parts of Iowa, Illinois and other big growing states.
"We've seen all week long fairly light trading volume, and we've seen a choppy trade," said Tom Leffler, owner of Leffler Commodities LLC, a brokerage in Augusta, Kan. "Everybody is waiting to see what happens Thursday."
Chicago Board of Trade soybeans for November delivery, the most-actively traded contract, gained 3 1/4 cents, or 0.2%, to settle at $13.58 1/4 a bushel. Soybean futures had declined in the previous two sessions after hitting a six-week high last week as traders worried that the dearth of rain in the western Farm Belt would reduce production.
Analysts expect the USDA to cut projected domestic soybean output this year by 3.3% to 3.15 billion bushels from its forecast last month, according to a survey by The Wall Street Journal.
"We might have a big day tomorrow for soybeans," said Fain Shaffer, president of brokerage Infinity Trading Corp. in Indianapolis. "A lot of these fields are just absolutely ruined."
Weather forecasts Wednesday showed more rainfall in the near-term outlook for the Midwest, but traders say the rains are likely to be too little, too late to help soybean output rebound.
The soybean crop is more vulnerable to damage from hot, dry weather than the corn crop because it has a later growing season. Corn underwent its main development stage in July, when conditions were more favorable. Analysts are calling for a 0.9% reduction in corn production in Thursday's report, but output is still expected to be a record.
Corn futures also ticked up Wednesday. CBOT corn for December delivery, the most-active contract, climbed 3 1/2 cents, or 0.8%, to $4.72 1/2 a bushel.
CBOT December wheat rose 1 1/2 cents, or 0.2%, to $6.48 a bushel. Wheat futures often trade in tandem with corn because both are used in animal feed.
--Tony Dreibus contributed to this article.
Write to Alexandra Wexler at email@example.com
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(END) Dow Jones Newswires
September 11, 2013 15:28 ET (19:28 GMT)
DJ Soybean, Grain Prices Tick Up Ahead of Crop Estimates -- Update->copyright
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