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Corn, soybean futures hit multi-year highs on supply fears

05/07/2021 | 03:54pm EDT

* Corn reaches highest since March 2013

* Traders await USDA crop report on May 12

* Dryness in Brazil fuels supply fears

* Soybeans hit highest since October 2012

CHICAGO, May 7 (Reuters) - Concerns that global crop supplies will remain lean pushed Chicago Board of Trade corn futures to their highest price since March 2013 on Friday, while soybean futures reached their highest since October 2012.

The markets surged before the weekend as traders braced for the potential of further rallies driven by tightening inventories and a monthly U.S. Department of Agriculture crop report due on Wednesday.

In its first estimates for 2021/22, the USDA is expected to predict U.S. soybean ending stocks will remain tight at 138 million bushels, according to a Reuters poll of analysts. They projected the agency will reduce its 2020/21 stocks estimate to 117 million bushels from 120 million.

"The market's gone vertical this week," said Don Roose, president of Iowa-based broker U.S. Commodities.

The most-active corn contract settled 13-1/2 cents firmer at $7.32-1/4 per bushel and reached a peak of $7.35-1/4, its highest price since March 2013. The contract gained a whopping 8.8% this week.

Soybeans climbed 20-1/4 cents to $15.89-3/4 per bushel and reached their highest price since October 2012 at $15.99-1/2. For the week, the most-active contract rose 3.6%.

Wheat jumped 8-1/2 cents to $7.61-3/4 per bushel at the CBOT and traded near an eight-year high reached last week.

The gains built on a sizzling rally that began last year as China accelerated imports of U.S. farm products.

In their biggest purchase since January, Chinese importers bought 1.36 million tonnes of U.S. corn that will be shipped during the 2021/22 marketing year, which starts in September, according to USDA.

In Brazil, a rival supplier, forecasts continued to show little rain for parched corn-growing areas.

Dryness raises the threat of deteriorating yields for the country's second annual corn harvest, considered crucial to boosting short-term availability ahead of the U.S. harvest later in the year.

"It's needed more than ever, but it's not forthcoming," Rabobank analyst Michael Magdovitz said. (Reporting by Tom Polansek in Chicago, Gus Trompiz in Paris and Naveen Thukral in Singapore; Editing by Andrea Ricci)

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
CORN FUTURES (C) - CBR (FLOOR)/C1 0.68% 664.25 End-of-day quote.36.31%
CORN?FUTURES (SETTLEMENT ONLY) (ZC) - CBR (FLOOR)/C11 -2.27% 498 End-of-day quote.0.00%
EURO / BRAZILIAN REAL (EUR/BRL) -0.04% 5.9268 Delayed Quote.-6.70%
S&P GSCI CORN INDEX -1.54% 449.1228 Delayed Quote.14.26%
S&P GSCI SOY BEANS INDEX -0.90% 512.456 Delayed Quote.-0.67%
SOYBEAN MEAL FUTURES (ZM) - CBE (ELECTRONIC)/C1 -2.67% 353.6 End-of-day quote.-14.11%
WHEAT FUTURES (W) - CBR (FLOOR)/C1 1.57% 661.25 End-of-day quote.1.64%
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