SINGAPORE- Chicago wheat slid for a third straight session on Wednesday to its lowest since mid-December, weighed down by a US government forecast of bigger-than-expected world inventories.
Soybeans eased as the market was pressured by concerns over demand from top importer China, where the coronavirus epidemic has claimed more than 1,100 lives and turned bustling cities into ghost towns.
“Wheat prices rallied in January but the world still has ample supplies and it hard for the market to sustain those gains,” said Phin Ziebell, agribusiness economist at National Australia Bank.
“There is disruption in grains trade in China because of the coronavirus which is adding pressure on prices. The question is how long before China starts truing the tap on agriculture imports?”
The most-active wheat contract on the Chicago Board Of Trade (CBOT) Wv1 was down 0.2 percent at $5.41 a bushel by 0317 GMT, after dropping to its weakest since Dec. 16 earlier in the session.
Soybeans Sv1 were down 0.1 percent at $8.84 a bushel and corn lost 0.1 percent to $3.79-1/4 a bushel.
The US Department of Agriculture (USDA) in a monthly report trimmed its forecast for 2019-20 world wheat ending stocks to 288.03 million tons, nearly unchanged from 288.08 million previously. Analysts surveyed by Reuters on average had expected a bigger reduction to 287.44 million tons.
The USDA left its forecast for US 2019-20 corn ending stocks unchanged at 1.892 billion bushels, while analysts surveyed by Reuters on average expected a reduction.
The government cut its forecast for US 2019-20 soybean ending stocks to 425 million bushels, from 475 million previously, citing increased export demand from China even as concerns about the virus persist.
The coronavirus outbreak could reduce Chinese purchases of US agricultural products this year under the Phase 1 trade deal signed by the countries, White House national security adviser Robert O’Brien said on Tuesday.
The USDA raised its estimate for Brazil’s soybean crop to 125 million tons, up 2 million from January, and raised its forecast for global 2019-20 soy ending stocks. – Reuters
