Maize and wheat closed lower on Tuesday on the back of weaker prices on the Chicago Board of Trade.
“Traders are waiting for the US Department of Agriculture's monthly supply-and-demand report being released tomorrow and some did some pre-ordered on the back of expectations of a bearish report. The lower prices are also due to some long covering before the release of the report and demand is just not there; that caused lower prices on the Chicago Board of Trade‚” a local trader said.
The near-dated September white maize contract dropped R30 to R2‚500 a ton‚ the December white maize contract shed R23 to R2‚563 a ton and the March 2013 white maize contract slipped R19 to R2‚568.00 a ton.
The near-dated September yellow maize contract was down R16 to R2‚526 a ton‚ the December yellow maize contract lost R17 to R2‚560 a ton and the March 2013 yellow maize contract dipped R9 to R2‚558 a ton.
The September wheat contract was down R55 to R3‚388 a ton‚ the December wheat contract shed R51 to R3‚474.80 a ton‚ while the March 2013 wheat contract was untraded at R3‚595 a ton.
Meanwhile US corn futures settled lower on Monday‚ pressured by weaker cash markets as farmers harvested their crops and by risk-averse trade ahead of a government crop report on Wednesday.
Chicago Board of Trade September corn futures‚ thinly traded ahead of the contract's expiration Friday‚ fell 14 cents‚ or 1.8%‚ to $7.81 a bushel‚ a four-week closing low. Most-active December corn fell 16 1/4 cents‚ or 2.0%‚ to $7.83 1/4 a bushel‚ a six-week closing low.
High corn prices are luring farmers to sell corn supplies as soon as they are harvested‚ leading to weaker cash markets‚ which are in turn weighing on futures‚ traders said.
Futures also fell because market participants were selling futures to exit positions‚ reducing their risk ahead of the US Department of Agriculture's monthly supply-and-demand report due Wednesday at 8.30am EDT. The report will include updated forecasts for the US corn and soybean crops‚ as well as inventories forecasts for those commodities and wheat.
Analysts on average said they expect the USDA on Wednesday to lower its forecast for the national average corn yield this year by 2.3%‚ to 120.6 bushels an acre from 123.4 bushels an acre‚ due to the country's worst drought in decades‚ according to a Dow Jones Newswires poll. They also expect the government to pare its projection for domestic corn inventories at the end of the 2012-13 marketing year by 4.9%‚ to 618 million bushels from the 650 million forecast in its report last month. - I-Net Bridge