IV:Grains recover from post-USDA losses; Corn futures up 1%
Investing.com - U.S. grain futures were higher during early U.S. morning hours on Tuesday, with corn futures leading gains, as the previous session’s sharp decline encouraged investors to return back to the market to seek cheap valuations.
On the Chicago Mercantile Exchange, corn futures for May delivery traded at USD6.4962 a bushel, up 1.1% on the day. The May contract rose by as much as 1.25% earlier in the day to hit a session high of USD6.5062 a bushel.
Corn futures tumbled 7.5% on Monday, the biggest one-day percentage drop in nearly four years, to hit the lowest level since June, as investors sold the grain in response to last week’s bearish U.S. Department of Agriculture supply report.
The USDA said U.S. corn stockpiles totaled 5.39 billion bushels as of March 1, well above market expectations of 4.99 billion bushels.
The USDA also said that U.S. farmers will plant 97.28 million acres of corn this year, a small increase from last year and the most planted since 1936.
The news prompted large institutional investors and hedge funds to liquidate bets that prices will rise in the near-term
Corn futures have lost 22% since hitting an all-time high of USD8.3325 a bushel, set at the height of the U.S. drought in August 2012.
Meanwhile, wheat for May delivery traded at USD6.7162 a bushel, up 1.1% on the day. The May contract rose by as much as 1.2% earlier to hit a daily high of USD6.7262 a bushel.
Wheat prices tumbled to USD6.6025 a bushel on Monday, the lowest level since June 22, as investors exited bets prices will rise after Thursday’s larger supply forecasts from the USDA.
The agency said wheat stockpiles totaled 1.23 billion bushels at the start of March, 5% above the analysts' consensus of 1.17 billion bushels.
Elsewhere, soybeans futures for May delivery traded at USD14.0225 a bushel, up 0.8%. The May contract rose by as much as 0.9% earlier in the session to hit a daily high of USD14.0238 a bushel.
Soy prices fell to a 12-week low of USD13.8562 a bushel on Monday, amid easing concerns over U.S. supplies.
The USDA said soybean stockpiles on March 1 totaled 999 million bushels, 5.5% above the average analyst expectation of 947 million bushels.
The agency also said U.S. farmers are forecast to plant 77.1 million acres with soybeans this year, the fourth-highest level on record.
Corn is the biggest U.S. crop, followed by soybeans, government figures show. Wheat was fourth, behind hay.
