Grain futures mixed, wheat heads for a sixth consecutive week of declines

Grains were mixed on Friday, with wheat heading for a sixth straight week of declines, the longest streak of losses since October 2011 amid slowing US exports and a record-high global output. Meanwhile, soybeans advanced, while corn declined for a fourth day, after falling to the lowest since August 2010.

Wheat futures for settlement in March declined by 0.33% to trade at $5.8250 per bushel by 13:33 GMT. Prices jumped to a session high of $5.8738, while day’s bottom was touched at $5.8112 per bushel. Yesterday prices touched $5.7838, the weakest level since May 2012 and the contract headed for a sixth consecutive weekly decline, the longest streak since October 2011. The grain slumped 22% in 2013, the largest annual decline since 2008, on expectations for a record-high global output of 711.42 million metric tons, according to data by the USDA.

The US Department of Agriculture reported US net export sales of old crop wheat declined by 55% to 110 825 tons in the week ended January 2nd from the previous week.

According to a Bloomberg survey, global wheat reserves will increase 3.9% and will reach 182.68 million tons in 2013-14 from a year ago. The US Department of Agriculture will release its updated estimates later in the trading session.

Meanwhile, weather in the US wheat producing regions will be mostly favorable in the next seven days. DTN’s January 9th forecast called for the extreme cold to continue breaking across the Midwest, with temperatures reaching above-normal levels by the end of the week and to continue through the first half of next week. No damaging cold is expected for the winter wheat areas for at least the next 7 days. Meanwhile, no significant cold threats and no precipitations are indicated during the next seven days, in the Southern Plains.

Elsewhere on the grains market, soybeans futures for settlement in March advanced 0.19% to trade at $12.7688 per bushel by 13:36 GMT. Prices swung between day’s high and low of $12.8012 and $12.7162 per bushel respectively. On January 2nd prices touched $12.6262 per bushel, the lowest since November 8th. The oilseed settled last year 8.5% lower.

Corn loses ground as well

On the Chicago Board of Trade, corn futures for March delivery traded at $4.0988 a bushel by 13:34 GMT, falling 0.37% for the day. Futures held in a range between day’s high and low of $4.1188 and $4.0862 per bushel. Yesterday prices touched $4.0812, the lowest since August 2010. The grain lost nearly 40% in 2013, the steepest annual drop on record, on projections that the global output will surge to 964.3 million tons in the 2013-2014 season, boosted by record production in the US, the world’s top producer.

According to a Bloomberg survey of 24 analysts, US corn inventories on December 1st probably totaled 273.4 million metric tons, the most since 1994 and 34% higher than a year ago.

The weather conditions in Brazil were beneficial for the oilseed, while in Argentina the hot weather diminished the already low soil moisture, harming the corn and soybeans developing crops. DTN reported on January 9th that conditions will remain favorable for developing soybeans in Rio Grande do Sul and southern Parana. According to the website, rainfall may remain limited in northern Parana and Mato Grosso during the next 7 days, having some impact on filling soybeans. However, no major crop stress is indicated at this time and in addition, the conditions will be favorable for early soybean harvest. Meanwhile, variable rain pattern is expected in Argentina. The website reported, in central Argentina, high temperatures and little rainfall at this time wane soil moisture and increase stress on developing corn and soybeans.

On Thursday and Friday, moderate to heavy showers and thunderstorms along with lower temperatures will favor the developing crops. Crop stress is expected to continue in the growing areas of southern Buenos Aires and La Pampa, which may limit the planting of double-cropped soybeans in these areas.