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U.S. crop futures suffer double-digit weekly losses over fund selling

2019-03-03 04:46

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CHICAGO, March 2 (Xinhua) -- Chicago Board of Trade (CBOT) crop futures traded sharply lower in the trading week ending on March 1, with all the most active contracts suffering double-digit losses due to massive selling, despite strong export sales and progress in trade talks.

The most active corn for May delivery was down 11.5 cents, or 2.99 percent weekly, to settle at 3.73 dollars per bushel. May wheat was down 34.5 cents, or 7.02 percent, to close at 4.5725 dollars. March soybeans were down 12.25 cents, or 1.33 percent, to settle at 9.115 dollar per bushel.

U.S. soybeans had posted 1.79 percent gains in the trading week which ended Feb. 22, obviously boosted by progress in the 7th round of high-level U.S.-China trade talks in Washington.

However, CBOT futures in the past week were surprisingly not stronger relative to the optimism regarding U.S.-China trade progress.

AgResource, a Chicago-based agricultural research firm, said in a commentary that the ups and downs of trade disputes frustrated traders and producers, leading to market apathy and disbelief. The apathy and uncertainty, triggered fluctuation in soybean and other crop futures.

"This wild volatility will continue if we don't get any kind of real action coming out of this deal and get things rolling," said Virginia McGathey, a market analyst with McGathey Commodities.

Even a strong export sales report released by the U.S. Department of Agriculture (USDA) failed to push up CBOT futures.

According to the latest USDA data, for the period of Feb. 15-21, a total of 2,196,000 metric tons of soybeans, 1,239,900 metric tons of corn, and 476,400 metric tons of wheat were reported for 2018/19 export sales, either within or even above market expectations.

CBOT wheat suffered the most during the past week, recording a more than 7 percent decline.

Under the pressure of stiff international competition and massive fund selling, the wheat futures kept posting losses for the whole trading week.

The last time that CBOT wheat saw such a big weekly fall was in the third week of August 2018, down 7.46 percent.

As for CBOT corn, although the most active May contract rebounded on Friday but it still ended the week in the negative territory.

Mark Gold, a veteran analyst told the 2019 Commodity Classic that he's still upbeat on corn and soybeans despite recent declines.

"I think both corn and soybeans, if we have a trade deal (with China), can move much higher than most people would think," he said during the agriculture industry gathering this week in Orlando, Florida.
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