Soybeans extended the biggest slump in five years to the lowest since December 2011 after a U.S. report that showed the country’s farmers will plant the largest area ever with the oilseed. Corn dropped to a five-month low.
Seedings in the U.S. will reach a record 84.8 million acres, up 11 percent from a year earlier, the U.S. Department of Agriculture reported yesterday. Soybean stockpiles as of June 1 as reported by the USDA were bigger than expected.
Soybeans for November delivery lost 0.7 percent to $11.495 a bushel on the Chicago Board of Trade by 4:59 a.m. after earlier dropping to $11.465, the lowest level for a most-active contract since Dec. 21, 2011. Futures tumbled 5.8 percent yesterday for the biggest drop since July 2009.
“There was nothing, nothing at all, in the USDA’s plantings and stocks reports that was even modestly, tacitly supportive of grain prices,” economist Dennis Gartman wrote in his newsletter. “Everything was stunningly bearish.”
Soybean inventories were 405 million bushels at the start of June, larger than the 382 million estimated by analysts in a Bloomberg survey. About 72 percent of the crop was rated in good or excellent condition on June 29, up from 67 percent a year earlier, the USDA said in a separate report yesterday. The U.S. is the world’s biggest grower.
“The market is now looking at the conditions of the U.S. crop, which is quite good as well, and started to build in some large expectations for new crop,” Paul Deane, an analyst at Australia & New Zealand Banking Group Ltd., said by phone from Melbourne today.
Corn Falls
Corn for December delivery fell 0.3 percent to $4.24 a bushel, and touched $4.21, the lowest since Jan. 21. Prices dropped 4.9 percent yesterday, the biggest decline since June 28, 2013.
Futures tumbled 15 percent in the second quarter, the most since the three months through June 2013, as stockpiles in the U.S. reached 3.854 billion bushels following record production last year, the USDA said. The average estimate of 26 analysts surveyed by Bloomberg was 3.723 billion bushels.
Wheat for September delivery fell 0.3 percent to $5.7575 a bushel. Futures dropped 2.7 percent yesterday to cap a 17 percent quarterly slump, the biggest such decline since June 2011. Milling wheat for December delivery traded on Euronext in Paris fell 0.1 percent to 185.50 euros ($254) a metric ton.
