Grain and soybean futures prices fell sharply Monday on the Chicago Board of Trade amid forecasts for April showers in the nation’s major crop-growing areas.
On other markets, orange juice futures surged for the second straight session, energy futures advanced sharply, precious metals were lower, and livestock and meat futures were mixed.
Wheat futures settled 1 cent to 4.25 cents lower, with the contract for delivery in May at $4.2725 a bushel; corn was 6.25 to 7.75 cents lower, with May at $2.715 a bushel; oats were 9.25 to 10 cents lower, with May at $1.9525 a bushel, and soybeans were 12 to 16 cents lower, with May at $7.685 a bushel.
The selloff in the grain and soybean markets was widely seen as a reaction to Friday’s six- to 10-day National Weather Service forecast for above-average rainfall between March 30 and April 3 in most of the central and all of the eastern United States.
The winter wheat crop in the central and southern Great Plains needs precipitation, and rain is also needed to replenish soil moisture in the Midwest, where corn, soybean and oat planting will soon begin.
Further selling was attributed to internal market influences and to increasingly bearish expectations for Friday’s planted-acreage estimate and quarterly grain stocks report from the Agriculture Department.
“The combination of the threat of precipitation and that very important government report just triggered a lot of liquidation,” said Pat O’Connell, a grain market analyst with Refco Inc., a large Chicago-based futures brokerage.
A new six- to 10-day National Weather Service forecast issued after the close called for mostly dry weather in the Great Plains and parts of the Midwest April 2 to 6.
The soybean market appeared to lead the collapse, but oats registered the steepest relative losses. Oats for May and July delivery fell the permitted daily limit of 10 cents a bushel.
Frozen concentrated orange juice futures soared the 5-cent-a-pound limit on the New York Cotton Exchange on buying linked to reports that some of Florida’s largest orange juice processors had raised or planned to raise their wholesale prices to $1.60 to $1.65 a pound from $1.50.
The price increase may cause a scramble for near-term deliveries, but projections for abundant supplies from Brazil should ensure against supply tightness, said analyst Judy Ganes of Shearson Lehman Hutton Inc.
Orange juice settled 4.70 to 5 cents higher, with May at $1.609 a pound.
Gold and silver futures fell on New York’s Commodity Exchange, reflecting a continued easing of inflation fears.
Gold settled $1.70 to $2.10 lower, with April at $391.60 an ounce; silver was 5.7 to 6 cents lower, with May at $6.003 an ounce.
Cattle futures finished mostly higher on the Chicago Mercantile Exchange, led by a surge of speculative and commercial buying in the feeder cattle market amid indications strong consumer demand.
Pork futures ended the day lower, with most of the selling stemming from Friday’s USDA cold-storage report, which showed a record number of pork bellies in cold storage for the fourth consecutive month.