Commodity Blog

Posts Tagged ‘crops’

Corn and wheat retreated today on the forecast rains will help boost growth of the crops. Previously traders were concerned that drought would damage plants. Now forecasts promised rains in the US Midwest over next several days. December futures for delivery of corn fell $0.08 (1.1 percent) to $7.175 per bushel at 11:40 on CBoT. Contract for delivery of wheat in December slipped $0.1525 (2 percent) to $7.4275 per bushel.

Rubber erased some of its losses as the threat of adverse weather reducing supplies from Thailand overshadowed concerns about possible slowdown of the global economic growth. 60 percent of Thailand’s south received heavy rainfalls. Rubber is still down over the trading session as the yen strengthened, reducing attractiveness of commodities prices in the Japanese currency, and oil fell 1 percent to $86.70 per barrel. January delivery for rubber subtracted 1 percent to 33,745 yuan ($5,283) per metric ton on Shanghai Futures Exchange.

Wheat gained today on the speculation hot weather and drought in the US will reduce output.

Amount of precipitation in some parts of the US was only quarter compared to the normal for this part of the year. Crops were already harmed by adverse weather in the second part of the last year. The US Department of Agriculture predicts output of hard, red-winter wheat may shrink 22 percent, compared to the previous year, to 794.4 million bushels as a result.

Futures for delivery of wheat in December gained $0.0725 (1 percent) to $7.5925 per bushel as of 10:31 on CBoT after it earlier reached $7.6775, the highest price for a most-active contract since June 14. Over the year wheat rose 8 percent.

Gold futures retreated from the record, showing the biggest drop in 7 weeks, after COMEX boosted margin requirements. CME Group Inc. (owner of COMEX) increased margin required to trade gold contracts by 22 percent. As a result, traders liquidated their positions en masse. The situation reminds the one with the silver earlier this year, when the increase of margin requirement put an end to the impressive rally of silver and caused a hit to the precious metal, from which it still hasn’t recovered. Gold looks too strong to fall in a same way. Moreover, the margin increase occurred when the yellow metal had a clearly bullish trend, while silver was caught by the CME decision during a correction. Still, caution is advised. December futures for gold delivery fell $32.80 (1.8 percent) to $1,751.50 by 13:39 on COMEX.

Corn, soybeans and wheat gained today as the US Department of Agriculture cut its forecast for harvest. The USDA decreased its estimates compared to July predictions because of excessively hot weather in parts of the US. Estimates for corn were lowered by 4.1 percent, for soybeans by 5.2 percent and for spring harvest of wheat by 5.2 percent. December futures for delivery of corn rose $0.255 (3.7 percent) to $7.14 per bushel as of 13:40 on CBoT. November futures for delivery of soybeans gained $0.3025 (2.3 percent) to $13.3175 per bushel. Contract for delivery of wheat in December advanced $0.1375 (1.9 percent) to $7.33.

Soybeans extended the longest rally since August on concerns that adverse weather may hurt crops in the US. The National Weather Service predicted that temperatures will be 12 degrees Fahrenheit above normal for five days starting July 16 in the Midwest. November futures for delivery of soybeans added $0.02 cents (0.1 percent) to $13.8175 per bushel at 10:30 on CBoT.

Gold retreated from the record as Federal Reserve Chairman Ben Bernanke spoke today, indicating that the Fed won’t add more stimulus for the US economy. Earlier the precious metal jumped to a record as Fitch Ratings downgraded Greece’s credit rating. August futures for delivery of gold gained $4.10 (0.3 percent) to $1,589.60 as of 12:46 on COMEX after reaching the all-time high of $1,594.90 per ounce.

Sugar posted a biggest drop in eight weeks today on the forecast that production in Brazil will be bigger than previously estimated. Prices climbed 24 percent in the last month on concerns about output. October futures for delivery of raw sugar slumped as much as 0.0122 (4 percent) to $0.2902 per pound by 14:00 on ICE, posting the biggest drop since May 19. Yesterday, the price reached the highest level in five months of 0.3133 cents.

Corn and wheat slumped today as planted area reported by the US Department of Agriculture was bigger than estimated by analysts.

US farmers planted 92.282 million acres of corn this year, 1.8 percent above analysts’ estimates and the second biggest area planted by corn since 1944. US inventories were 3.67 billion bushels as of June 1, 12 percent above predicted amount. As much as 13.627 million acres were planted by spring wheat, 2.6 percent higher than forecasts. Stockpiles were 861 million bushels as of June 1, beating market expectations by 4.6 percent.

Cheaper corn, used for feeding cattle, may result in meat prices drop. Corn also used for production of ethanol, so lower prices for the grain may translate in lower fuel prices.

December futures for delivery of corn dropped by the exchange limit of $0.3 (4.6 percent) to $6.205 per bushel by 13:15 on CBoT, the biggest decline since November 16. September futures for delivery of wheat slumped by the limit of $0.6 (8.9 percent) to $6.1425 per bushel, the lowest settlement since July 29.

Crude oil advanced for the second day today as the US inventories dropped more than predicted. The Energy Information Administration reported that the US stockpiles of crude fell by 4.4 million barrels to 359.5 million barrels last week, while market participant anticipated a decline by only 1.5 million barrels. August futures for delivery crude oil gained $1.88 to $94.77 per barrel on NYMEX.

Wheat jumped to the highest level in almost six weeks as excessive precipitation in the north of the US hurt crops. The US Department of Agriculture reported that about 69 percent of the spring-wheat crops were in good or excellent condition as of June 26, compared to 72 percent in the week before. Futures for delivery wheat in September climbed $0.21 (3.2 percent) to $6.7175 per bushel as of 13:15 on CBoT.

Gold gained today as the previous drop to the lowest level in five weeks attracted investors to the metal. Futures on gold reached $1,490.80 per ounce on June 27, the lowest settlement since May 20. Futures for delivery of gold in August went up $10.20 (0.7 percent) to $1,510.40 by 13:43 on COMEX.

Corn and soybeans gained on the speculation that hot weather in the US may hurt crops. Temperatures in the southern Great Plains are 12 degrees Fahrenheit above normal. Heat can cause stress for crops that received too much rain last month. December contract for delivery of corn gained $0.1975 (3 percent) to $6.8025 per bushel by 13:15 on CBoT.

Crude oil rose for the second day on hopes that Greece’s Prime Minister George Papandreou will win a confidence vote today. The Prime Minister intends to continue budget cuts, but to implement austerity measures he need support from the parliament. The US crude oil inventories fell by 100,000 barrel, according to the estimates of analysts before the government report today. July futures for crude oil delivery traded at $93.40 per barrel on NYMEX.

Corn and wheat fell on the forecast that favorable weather will boost yield. Rainfall in the UK and France should boost crops that were already planted, as well as those that will be planted later. Stronger dollar curbed appeal of US commodities and attracted traders to Europe. December futures for corn delivery slid $0.03 (0.5 percent) to $6.57 per bushel as of 10:35 on CBoT.

Sugar reached the highest level in two months on concerns about disruptions of supplies from Brazil. Shipments of Brazilian sugar are expected to be delayed for another 20 or 30 days. October futures for delivery of raw sugar rose $0.0083 (3.3 percent) to $0.2621 per pound by 14:00 on ICE. The price for thee most-traded contract reached touched $0.2631, the highest level since April 12. Futures advanced 3.4 percent last week.

Cocoa fell on the speculation that there will enough supply to satisfy demand. INTL Hencorp Futures LLC predicted that a global surplus of cocoa will be 156,000 metric tons by September. The strengthening dollar also had its negative impact on commodities, including cocoa and wheat. September delivery for cocoa tumbled as much as $89 (3 percent) to $2,886 per ton as of 12:01 on ICE, posting the biggest drop since May 5.

Supply of wheat is also expected to be ample and therefore prices went down. Russia plans to lift the ban on exports by July 1, while rainy weather should help the crops in Ukraine. The US Department of Agriculture increased its forecast for global inventories on June 9 to 184.26 million metric tons, up 1.7 percent from the forecast in the previous month. Futures for delivery of wheat in September sand $0.31 (4.2 percent) to $7.0825 per bushel by 13:15 on CBoT after it reached $7.0325, the lowest price since March 17.

Futures on wheat slid today as the wet weather in Europe may boost crops, while Russia plans to lift its ban on exports. Rains improved prospects for harvest in Germany and may help crops in France this week. Russia, one of the biggest exporters of wheat in the world, will renew exports on July 1. July contract for wheat delivery slipped $0.23 (2.9 percent) to $7.5925 per bushel as of 13:15 on CBoT.

Rains in the US had opposite effect on corn, slowing planting and boosting the commodity. The government report said yesterday that 86 percent of the crop was planted by May 29, compared to the five-year average of 95 percent. Midwest had strongest rains and farmers of the region may decide to take insurance instead of planting. Futures on corn for delivery in July gained as much as $0.11 (1.5 percent) to $7.585 per bushel.