September 12, 2017 / 8:35 PM / in 9 months

GRAINS-Corn falls 1.7 pct after USDA raises U.S. yield estimate

    * USDA raises U.S. corn yield estimate to 169.9 bpa
    * USDA ups soy yield to 49.9 bpa, topping expectations
    * Wheat turns higher after early declines

 (Updates with closing CBOT prices)
    By Julie Ingwersen
    CHICAGO, Sept 12 (Reuters) - Chicago corn futures fell 1.7
percent on Tuesday, the biggest drop for a most-active contract
 in nearly a month, after the U.S. Department of
Agriculture raised its 2017 corn yield forecast, bucking most
trade expectations for a reduction.
    Soybean futures fell after the USDA surprised analysts by
hiking its U.S. soybean yield estimate as well.
    Wheat futures closed higher, rallying from early declines
and gaining against corn on inter-market spreads.
    Chicago Board of Trade December corn settled down 6
cents at $3.51-1/2 per bushel after dipping to $3.45-1/2, its
lowest since Aug. 31.
    CBOT November soybeans ended down 9-1/2 cents at
$9.50-1/2 per bushel while December wheat rose 7-1/4 cents
to $4.42 a bushel.
    Corn fell after the USDA in a monthly report raised its
estimate of the average U.S. 2017 corn yield to 169.9 bushels
per acre (bpa) from its August estimate of 169.5 bpa and above
an average of analyst expectations for 168.2 bpa.
    "Two months in a row, the government throws a bearish
surprise at the trade. There's nothing bullish about these
numbers: yields are bigger than the trade thought," said Don
Roose, president of Iowa-based U.S. Commodities.
    USDA raised its soybean yield estimate to 49.9 bpa, from
49.4 in August, topping a range of trade expectations.

    "Soybeans got to enjoy some beneficial weather in the Corn
Belt in August, and yield was increased as a result. This bump
is not unexpected, but the 0.5 additional bushels per acre keeps
the balance sheet's ending stocks at 475 million bushels, even
with greater export demand," said Alex Norton, analyst at Beeson
    The increases came in spite of dry conditions in portions of
the Midwest crop belt.
    "The U.S. yields show us just how resilient crops are these
days to weather-related stress events. Technology has improved
over the past five years," said Terry Reilly, senior commodity
analyst with Futures International.
    CBOT wheat firmed on long wheat/short corn spreads, with the
December wheat contract climbing to the day's high late in
the trading session. 
    Also supportive, the USDA trimmed its world wheat ending
stocks forecast for 2017/18 to 263.14 million tonnes, from
264.69 million in August.
    CBOT settlement prices:
                                  Net     Pct  Volume
                         Last  change  change        
 CBOT wheat     WZ7    442.00    7.25     1.7   90811
 CBOT corn      CZ7    351.50   -6.00    -1.7  261184
 CBOT soybeans  SX7    950.50   -9.50    -1.0  164290
 CBOT soymeal   SMZ7   300.00   -3.60    -1.2   63574
 CBOT soyoil    BOZ7    35.19    0.04     0.1   75938
    NOTE: CBOT September wheat, December corn and November
soybeans shown in cents per bushel, December soymeal in dollars
per short ton and December soyoil in cents per lb.

 (Additional reporting by Tom Polansek in Chicago, Michael Hogan
in Hamburg and Naveen Thukral in Singapore; Editing by Lisa
Shumaker and Richard Chang)
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