South African maize futures ended decidedly weaker on Friday, but off the session's worst levels.
“The USDA [US Department of Agriculture] report was not as bullish as the market had anticipated,” said Johan Theron, dealer at RMB.
The January 2012 white maize slid R38 to R2,742 per ton, the March 2012 white maize contract tumbled R70 to R2,622 per ton, July 2012 white maize shed R80 to R1,992 per ton, according to preliminary I-Net Bridge data.
The January 2012 yellow maize contract bucked the trend, lifting R5 to R2,775 per ton, the March 2012 yellow maize lost R60 to R2,570 per ton and the July 2012 yellow maize contract dropped R80 R1,960 per ton.
The January wheat contract was down R49 to R2,748 per ton, while March wheat lost R50 to R2,795 per ton, and the July 2012 wheat contract dipped R66 to R2,870 per ton.
At 12:00 when the local grain market closed, the rand was at R8.05 to the US dollar, unchanged from the previous session.
Hansie Swanepoel, a trader at Vrystaat Mielies, said: “We had anticipated the pullback in local maize futures, given that they were overbought. The market selloff was earlier in the session triggered by the USDA report, but later on trimmed losses due to tight local maize stocks.”
Meanwhile, Dow Jones Newswires reported that US corn futures plunged on Thursday, falling their exchange-imposed daily trading limit of 40 cents after the government raised its harvest and supply outlook.
Futures prices tumbled after the USDA, in a closely watched crop report, surprised traders by raising its estimate for US and global grain supplies. Traders were widely expecting a decrease.
The report sent corn prices tumbling, with the March delivery contract at the Chicago Board of Trade down 40 cents or 6% at US$6.11 1/2 per bushel.
Traders bracing for lower estimates were caught off-guard by the government's more-ample supply projections, leading to a rush of sellers trying to exit long positions, or bets prices would rise.
Traders estimated speculative-fund selling amounted to a net 18,000 contracts, a large number.
The report, along with recent rains in South America that are helping the corn crops in Argentina and Brazil, suggests more corn will be available. - I-Net Bridge