Crop prices jumped with soybeans and corn rising to the highest level in more than a month as rains swamped fields in the U.S., the world’s biggest producer.
Parts of the Midwest received more than six times the normal rainfall in the week through Monday, the National Weather Service said. Farmers are planting soybeans at the slowest pace for this time of year since 1996 and the wheat harvest is making the least progress in almost two decades.
The advance has pared price declines in the past year as global output headed for a record. Soybeans, used for cooking oil and livestock feed, lost 22 per cent, while corn dropped 17 per cent as supplies expanded. Australian and U.S. forecasters say an El Nino weather pattern is strengthening, which may bring wetter summers to North America. Citigroup Inc. says returns from grains could increase by as much as 25 per cent.
“U.S. farmers are somewhat late planting soybeans this year, which is prompting concerns that their yields will be below normal,” Tobin Gorey, an analyst at Commonwealth Bank of Australia, wrote in a note. “Farmers have had to delay harvesting in both hard and soft red winter wheat regions,” he wrote, referring to U.S. grain varieties.
Corn planting will trail government estimates after the rains, according Roach Ag Marketing Ltd., an industry adviser based in Boca Raton, Fla.
Ninety percent of the soybean crop was planted as of 21 June, the slowest pace since 1996, U.S. Department of Agriculture data show. Nineteen percent of the winter-wheat crop was harvested, the lowest since 1997. Soybeans have rebounded 8.1 per cent from five-year lows this month.
Bloomberg News, edited by ESM
