rebounded to $5 a bushel for the first time since September after the US
eroded ideas of ample domestic supplies of the grain, saying that inventories
are a little lower than thought and that sowings will fall significantly this
The US Department
of Agriculture, in a much-anticipated report on domestic grain stocks as of
March 1, said that inventories of corn had risen by 30% year on year to 7.01bn
bushels (178m tonnes).
However, the figure
was more than 90m bushels (2.3m tonnes) below market expectations, with traders expecting
inventories to have shown a bigger rise after last year's record harvest.
And the USDA, in a
separate closely-watched report, curtailed expectations of corn harvest
prospects for this year by estimating sowings at a four-year low of 91.7m
acres, down some 3.7m acres year on year.
The estimate was
more than 1m acres short of the figure that investors had expected.
'Bought back some demand'
The stocks figure
implied use of 3.45bn bushels (88m tonnes) of US corn during the three months to March 1, up
from 2.63bn bushels a year before, when consumption was squeezed by a dearth of
availability following the drought-hit 2012 harvest.
have bought back some demand," said Steve Kahler, chief operating officer
at Teucrium Trading, the New York-based issuer of commodity exchange-traded
USDA US corn data and (difference from market forecast)
March 1 stocks: 7.006bn bushels, (-93m bushels)
2014 sowings: 91.691m acres, (-1.057m acres)
2013 sowings were 95.365m acres
The forecast at the USDA's Outlook forum was 92.0m acres
margins are good, ethanol production margins are good, exports have been good.
unlikely to be many doubts, questions over these data," he said.
Stocks reports are
often the subject of some controversy among analysts, revealing figures which
are, on the face of it, difficult to explain.
The impact on
futures was send Chicago's benchmark May contract, which had tumbled 3.3% to
$4.75 3/4 a bushel ahead of the report for fear of a large stocks number, into
a sharp recovery.
|USDA US soybean data and (difference from market forecast)|
March 1 stocks: 992m bushels, (+3m bushels)
2014 sowings: 81.493m acres, (+475,000 acres)
2013 sowings were 76.533m acres
The forecast at the USDA's Outlook forum was 79.5m acres
The contract soared
to a six-month high of $5.00 3/4 a bushel at one point before easing back to
$4.99 1/4 a bushel as of 12:10 local time (18:10 UK time) a gain of 1.5% on
The new crop
December contract was up 1.9% at $4.96 1/2 a bushel, spurred by the
lower-than-expected sowings figure, closing the discount to the May contract.
Record soybean plantings
Price moves in
other crops were more mixed.
In soybeans, the
old-crop May contract found support from corn to gain 1.5% to $14.57 1/2 a
bushel. The USDA estimate for US inventories as of the start of this month was,
at 992m bushels, very close to market forecasts.
|USDA US wheat data and (difference from market forecast)|
March 1 stocks: 1.056bn bushels, (+14m bushels)
2014 sowings: 55.815m acres, (-462,000 acres)
2013 sowings were 56.156m acres
The forecast at the USDA's Outlook forum was 55.5m acres
But the new crop
November contract dropped 0.6% to $11.83 1/4 a bushel, undermined by data
signalling that the bigger-than-expected drop in corn sowings was being fuelled
by a switch to soybeans, a major competitor in farmers' spring planting
US soybean sowings
will hit a record 81.5m acres, the USDA said, a figure some 400,000 acres
bigger than investors had expected.
Mixed for wheat
For wheat, the
inventory data were a little bearish, in showing inventories as of March 1 at
1.06bn bushels, some 14m bushels more than investors had expected.
sowings, the estimate for plantings of 55.8m acres was roughly 460,000 acres below
market forecasts, reflecting a lower-than-expected figure for spring plantings
of 11.3m acres.
expected a spring sowings estimate of 12.27m acres.
The estimate for
winter wheat sowings was nudged higher to 42.0m acres, reflecting a slightly
higher estimate for plantings of hard red winter wheat.
May wheat, which
had fallen ahead of the data on hopes of rain for southern Plains crops, stood
0.8% lower at $6.90 a bushel in Chicago, with Kansas City-traded hard red
winter wheat down 0.89% at $7.57 1/4 a bushel.
In cotton, the USDA
pegged sowings at 11.1m acres including pima cotton, a rise of 107,000 acres,
The figure was
below the 11.5m acres the USDA outlined last month, at its Outlook conference,
and below the expectations of many analysts, who had forecast a bigger boost
the popularity of the fibre from relatively high prices.
York cotton for May stood 0.2% lower at 93.57 cents a pound in late deals, with
the new crop December contract down 0.1% at 79.82 cents a pound.