Chicago | Reuters — Concerns that global crop supplies will remain lean pushed Chicago Board of Trade corn futures to their highest price since March 2013 on Friday, while soybean futures reached their highest since October 2012.
The markets surged before the weekend as traders braced for the potential of further rallies driven by tightening inventories and a monthly U.S. Department of Agriculture crop report due on Wednesday.
In its first estimates for 2021-22, USDA is expected to predict U.S. soybean ending stocks will remain tight at 138 million bushels, according to a Reuters poll of analysts. They projected the agency will reduce its 2020/21 stocks estimate to 117 million bushels from 120 million.
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“The market’s gone vertical this week,” said Don Roose, president of Iowa-based broker U.S. Commodities.
The most-active corn contract settled 13-1/2 cents firmer at $7.32-1/4 per bushel and reached a peak of $7.35-1/4, its highest price since March 2013. The contract gained a whopping 8.8 per cent this week.
Soybeans climbed 20-1/4 cents to $15.89-3/4 per bushel and reached their highest price since October 2012 at $15.99-1/2. For the week, the most-active contract rose 3.6 per cent.
Wheat jumped 8-1/2 cents to $7.61-3/4 per bushel at the CBOT and traded near an eight-year high reached last week.
The gains built on a sizzling rally that began last year as China accelerated imports of U.S. farm products.
In their biggest purchase since January, Chinese importers bought 1.36 million tonnes of U.S. corn that will be shipped during the 2021/22 marketing year, which starts in September, according to USDA.
In Brazil, a rival supplier, forecasts continued to show little rain for parched corn-growing areas.
Dryness raises the threat of deteriorating yields for the country’s second annual corn harvest, considered crucial to boosting short-term availability ahead of the U.S. harvest later in the year.
“It’s needed more than ever, but it’s not forthcoming,” Rabobank analyst Michael Magdovitz said.
— Reporting for Reuters by Tom Polansek in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore.
