Corn jumped 10% in Chicago, dragging wheat 8% higher, after US officials threw "a curve ball" by slashing its estimate for sowings of the grain by nearly 1m acres – rather the increasing it as investors had expected.
American farmers planted 87.9m acres of a corn, the US Department of Agriculture said, a figure which, while higher than last year's sowings, fell 1.3m acres short of market expectations.
Analysts had expected corn sowings to have been encouraged by a strong start to plantings which, according to the USDA, saw half the crop planted by April 25, "the earliest date on record that planting had progressed to the midpoint".
"The bullish numbers… throw a curve ball at the corn market," Benson Quinn Commodities said.
Rival broker US Commodities said: "This report is a game changer."
'Friendly surprise'
The USDA added further heat to corn prices by pegging US corn inventories at 4.31bn bushels as of the start of this month, a figure which again fell short of analysts' expectations, and was termed a "friendly surprise" by Benson Quinn.
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USDA sowings data, difference from forecasts, and from (previous data)
Corn: 87.87m acres, -1.36m acres, (-930,000 acres)
Soybeans: 78.87m acres, +690,000 acres, (+770,000 acres)
Spring wheat: 13.91m acres, +180,000 acres, (+10,000 acres) |
"Feed usage was much larger than expected," US Commodities said, after many analysts forecast that smaller herds, and a shift to cheaper wheat, would depress corn take up by livestock farmers.
Corn for July touched $3.58 a bushel in early deals in Chicago, before losing some ground to stand up 8.5% at $3.52 ½ a bushel at 15:10 GMT.
Mixed for soybeans
"Acreage and quarterly stocks reports are viewed as sharply bullish corn," Allendale, the Illinois broker, said.
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USDA stocks data, difference from forecasts, and from (year before)
Corn: 4.31bn bushels,-290m bushels, (+49m bushels)
Soybeans: 571m bushels, -23m bushels, (-25m bushels)
Wheat: 973m bushels, +33m bushels, (+316m bushels) |
While Allendale added that the data was "slightly bearish" for wheat, with both stocks and spring sowings data greater than the market had expected, the grain gained on a spillover from the corn rally, standing 4.8% higher at $4.63 a bushel, after hitting $4.77 ¼ a bushel earlier.
Soybeans were the weakest pit in Chicago, with lower-than-expected stocks supporting the near-term lots, while new crop contracts struggled against a lift to soybean plantings which was higher than the market had expected.
July soybeans stood 2.25 cents higher at $9.49 ½ a bushel, with the August lot up 3.75 cents at $9.35 ¼ a bushel.
Record lows
Other surprises in the sowings data included a forecast that oats sowings will slump by 7% to a record low of 3.2m acres, led by a decline in North Dakota, where sowings were held back by rain.
Oats soared nearly 8% to $2.68 a bushel in early deals, before retreating to $2.63 a bushel, up 5.8% on the day.
Barley sowings were also forecast at a record low, of 3.0m acres, down 17% year on year, with again North Dakota acres notably low.
"Harvested area, forecasted at 2.55m acres, is down 18% from 2009, and if realised, will be the lowest since 1883," the USDA added.
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