South African maize futures finished the session decidedly weaker on Tuesday, as the stronger rand and “harvest pressure” weighed on the market.
The May 2012 white maize contract was down R61 to R2,145 per ton, July 2012 white maize lost R68 to R2,104 per ton, and September 2012 white maize shed R54 to R2,141 per ton, according to preliminary I-Net Bridge data.
The May 2012 yellow maize contract was down R64 to R2,048 per ton, while the July 2012 yellow maize contract receded R65 to R2,045 per ton and the September 2012 yellow maize contract was off R58.20 to R2,088.80 per ton.
The May wheat contract slipped R15 to R2,707 per ton, July wheat dipped R14 to R2,759 per ton, while the September 2012 wheat contract lost R8.80 to R2,784.20 per ton.
“We were much lower because of a combination of things. Firstly, the rand strengthened by almost ten cents in our session, between 09:00 and 12:00 and obviously a strong rand is very negative for local commodity prices - that's why we saw maize and soybeans tumble.
“We are also approaching our harvest time, we call it 'harvest pressure' - the buyers have already purchased according to their needs and so the farmers are sellers. There's also not a lot of fresh news coming out of the US,” a trader said.
Meanwhile, Dow Jones Newswires reported that US grain and soybean futures dropped on Monday, as market participants booked profits and rain in the US improved crop-planting conditions.
Lingering concerns about slowing Chinese economic growth also weighed on soybean futures on Monday.
Soybean futures led the declines in grain futures, settling near a two-week low, as traders took profits off the table after futures climbed to over seven-month highs last week.
Corn and wheat futures dropped to more than two-week lows as well, stumbling on improved weather for Midwest crops.
Weekend rains that moved through the Midwest recharged dry soils, a feature expected to boost crop potential for early-planted crops.
However, losses in both corn and wheat were limited, as there remained enough uncertainty ahead of a long growing season to temper an outright selloff, analysts added.
Meanwhile, “the rains in parts of the northwest corn-belt have improved the topsoil moisture situation for planting, and certainly that helps the prospect for more bean acres there,” Doug Houghton, an analyst at Brock Associates, an agricultural commodity advisory firm in Milwaukee said. “They do need that rain,” he added.
CBOT May corn ended down 6 cents at US$6.23 1/4, and the December contract that represents crops to be harvested in the fall dropped 10 3/4c to $5.26 1/4.
CBOT May wheat ended down 7 1/4 cents at $6.16 1/4 per bushel, May KCBT wheat ended 12 1/2 cents lower at $6.30 1/2 and May MGEX wheat ended down 8 3/4 cents to $8.15 1/2. - I-Net Bridge