Grain futures mixed, corn remains near 33-month low

Grain futures were mixed on Wednesday with wheat gaining and soybeans declining, while corn remained fairly steady near a recently hit 33-month low as weather conditions remained favorable and boosted prospects for a record-high crop.

On the Chicago Board of Trade, corn futures for September delivery traded at $5.2263 a bushel at 9:35 GMT, remaining flat on the day. Prices plunged to $5.2138 during Asian trading, a 33-month low. The grain fell 3% on Tuesday, extending current weeks decline to over 3.6% after marking a 0.18% weekly decline the previous one. Days high was at $5.2338 a bushel.

Commodity Weather Group said yesterday that cooler temperatures and rain are expected in Illinois and Iowa, the top U.S. corn and soybeans grower.

Paul Deane, an agricultural economist at Australia & New Zealand Banking Group Ltd. in Melbourne, said for Bloomberg: “The weather outlook is reasonably benign. The market’s taking the risk premium out of the price.”

Last week, the U.S. Department of Agriculture confirmed expectations for reduction in the total output to 13.95 billion bushels, down from 14.005. However, this is still an all-time record high and is 29% higher than last year’s drought damaged crop. This year’s global stockpiles are projected to rise to 150.97 million tons by the end of the 2013-2014 marketing year, 22% more than the previous period.

According to the USDA weekly crop progress report on Monday, corn silking fell behind last year’s pace, standing at 43% as of July 21. This was well above the preceding week’s 16% but far behind last year’s 84% and the five-year average reading of 56%.

As for the crop condition, this year’s quality is a lot better than the last season’s, but a bit worse than the previous week. As of July 21, 11% of the crop was categorized as “Very poor” and “Poor” compared to 9% a week earlier and 45% in 2012. Meanwhile, 26% was categorized as “Fair”, above last week’s 25% and below last year’s 29%. As for the premium quality, 63% was rated as good-excellent, compared to 66% a week earlier and 26% in 2012.

Soybeans fall

Meanwhile, soybeans fell slightly as the oilseed is also expected to benefit from favorable weather in the main U.S. growing regions. Soybeans for August delivery traded at $14.5800 a bushel at 9:37 GMT, down 0.25% on the day. Prices held in range between days high at $14.6650 and low of $14.5350, the lowest since July 16. The oilseed fell more than 3.5% on Tuesday, extending this weeks decline to over 2% after surging 4.32% last week.

In its weekly crop progress report, the U.S. Department of Agriculture said that as of July 21, 46% of the soybeans crop had bloomed, marking a 20% weekly advance since the previous report. However, blooming fell behind last year’s 78% during the comparable week and the five-year average of 59%.

As for the soybeans condition, the government agency reported it was overall the same like last week and far better than the previous season. As of July 21, 8% of the crop was categorized as “Very poor” and “Poor”, the same like the preceding week and well below 2012′s 25%. Meanwhile, 28% of the crop fell in the “Fair” category compared to 27% a week earlier and 34% last year. As for the premium quality, 64% was rated good-excellent, 1% less than the week ending July 14 but well above last year’s 31%.

Goldman Sachs’s 12-month price estimate for soybeans remained at $11 per bushel.

Wheat advances

Elsewhere on the market, wheat advanced 0.32% on the day. The September contract traded at $6.5613 a bushel at 9:35 GMT, ranging between days high and low of $6.5763 and $6.5338 a bushel respectively. The grain fell throughout the previous two days, bringing this weeks decline to over 1.1% after plunging 2.51% the previous 5-day period.

The USDA said in its crop progress report on Monday that as of July 21, 75% of the nation’s winter wheat crop was harvested, compared to 67% a week earlier. This was 1% below the five-year average pace but below last year’s 84% during the comparable week.

As for the spring wheat, the government agency reported that 85% of the crop was headed last week, marking a 14% advance from the preceding 7-day period. This was 3% lower than the five-year average and well below last year’s 97% during the comparable week.

The USDA said spring wheat condition was overall better than last season’s and almost unchanged from a week earlier. As of July 21, 5% of the crop was categorized as “Very poor” and “Poor”, the same like the previous week and better than last year’s 11%. Meanwhile, 27% of the grain was of “Fair” quality compared to 25% a week earlier and 29% in 2012. As for the premium crop, 68% was rated “Good” and “Excellent”, below 70% as of July 14 but above last year’s 60% during the comparable week.

Goldman Sachs’s 12-month price estimate for wheat stood at $6.50 per bushel.