Harvest weather remains crucial for the late maturing corn and soybean crops this year and some forecasts called a return of wet weather next week which is likely to support prices, analysts said.
“We have oil prices down and a lot of other commodities are showing some weakness at the moment,” said Toby Hassall, an analyst with Commodity Warrants Australia.
“The market is very sensitive to the weather outlook and it remains to be seen how much can be harvested before any more weather risks appear.”
The U.S. harvest is running three to five weeks behind its normal schedule because late sowing and heavy rains this autumn threaten to hit crop quality. High moisture soybeans and corn do not store well and grain protein levels can suffer.
“After a week of dry weather, the forecasters have called for an unexpected return for rain in U.S. corn and soybean regions from next week,” Commonwealth Bank of Australia said in a report.
“The forecasts are not a guaranteed event and warrant very close monitoring.”
The soybean harvest was 51 percent complete as of Sunday, up from 44 percent the previous week, but below trade estimates for 55 to 60 percent. The five-year average for this time of year is 87 percent, according to the U.S. Department of Agriculture.
USDA pegged the corn harvest at 25 percent finished, up from 20 percent a week earlier and in line with trade estimates for 24 to 26 percent. The five-year average for the corn harvest is 71 percent.
The U.S. Agriculture Department is now projecting a record U.S. soy harvest of 3.25 billion bushels and a near-record corn crop of 13.018 billion bushels. The government will revise its forecasts next week, with analysts mixed in their opinions of whether USDA will raise or lower its crop estimates, given the delayed harvest.
Private forecasters FC Stone and Informa Economics will also issue their crop estimates this week, which should give the grain markets price direction.
“Harvest progress continues slowly and well behind schedule. This is more important for soy, where more exposure means a higher chance of quality deterioration,” said ANZ in its daily agriculture report.
Chicago Board of Trade corn for December delivery fell 0.4 percent to $3.88-½ a bushel by 0343 GMT, after rising more than 2 percent on Tuesday, while November soybeans fell 0.3 percent to $10.03-¾ a bushel.
Oil, which often influences the prices of grains because of their use in making alternative fuels, fell for the first time in three days, toward $79 a barrel.
CBOT rice futures continued their upward trend on worries about the Indian rice supply which has triggered speculative buying. January contract rose 0.07 percent to $15.125.
India’s summer-sown rice output for 2009/10 is projected down 18 percent from 2008/09 after the worst monsoon in 37 years, according to the government’s first crop estimate of the season.
