Forexpros – U.S. grain futures soared on Friday, staging their biggest rally of the year following the release of a pair of highly-anticipated reports from the U.S. Department of Agriculture.
The USDA on Friday released two closely-watched reports, one detailing how much grain is in domestic storage as of March 1 and the other projecting how many acres farmers will plant this spring of major crops such as corn, soybeans and wheat.
On the Chicago Mercantile Exchange, soybeans for May delivery settled at USD14.0188 a bushel by close of trade Friday. On the week, prices rose 2.64%.
Earlier Friday, prices climbed to USD14.1588 a bushel, the highest since September 12.
Soybean futures rallied 3.45% on Friday, the largest one-day gain in five months after the U.S. Department of Agriculture said it expects U.S. farmers to sow 73.90 million acres with soybeans this year, down 1.4% from 2011 and the lowest in five years.
Analysts had expected U.S. soybean plantings to total just over 75.0 million acres.
The agency said the acreage numbers indicate a potential soy harvest of 3.2 billion bushels in the current marketing year.
The USDA also said soybean inventories on March 1 totaled 1.372 billion bushels, up 9.9% from the 1.249 billion a year earlier. The average analyst estimate was 1.371 billion bushels.
Consumption of the oilseed in the three months leading up to March totaled 998 million bushels, down 3% from a year earlier, the USDA said.
Soybean prices jumped 16% in the first three months of 2012 amid sustained concerns over distressed crops in major South American soy growers and on hopes demand from top consumer China will remain robust in the near-term.
The drop in acreage for soybeans comes as farmers jettison the oilseed in favor of corn, responding to tight supplies and historically high prices
Corn futures for May delivery settled at USD6.4412 a bushel by close of trade on Friday. On the week, prices added 0.4%.
Corn prices soared 6.57% on Friday, the biggest one-day advance in 21 months after the USDA said that corn inventories on March 1 fell by a greater-than-expected 7.9% to 6.009 billion bushels from a year earlier, the lowest for this time of year since 2004.
The supplies raised fears corn supplies will run low before the fall harvest, particularly as demand remains strong both at home and abroad.
The agency’s estimate of consumption in the three months ended February 29 unexpectedly rose 3.1% to a record 3.64 billion bushels.
Corn has moved its daily limit after the past five consecutive USDA quarterly stocks reports.
The USDA also said that U.S. farmers will plant would 95.9 million acres of corn, a 75-year high and above market expectations for 94.72 million. Farmers in Idaho, Iowa, Minnesota, North Dakota and South Dakota are forecast to plant record-breaking amounts of corn this year, according to the report.
According to the data, the corn acreage numbers indicate a potential record-large corn crop of 14.5 billion bushels in 2012.
Corn prices came under pressure earlier in the week as investors readjusted positions ahead of Friday’s USDA data.
On the quarter, corn prices dipped 0.4%.
Elsewhere on the Chicago Board of Trade, wheat for May delivery settled at USD6.5888 a bushel by close of trade on Friday. Prices rose 1.32 on the week.
Wheat prices surged 7.6% on Friday, the biggest gain since early October after the USDA said that wheat inventories as of March 1 fell 16% from a year earlier to a three-year low of 1.201 billion bushels.
The agency also said that spring-wheat plantings will fall to 11.976 million acres from 12.394 million a year earlier. Analysts projected 13.35 million on average.
Total U.S. wheat plantings totaled 55.9 million acres, well below an average estimate for 57.422 million.
The wheat acreage numbers indicated wheat harvest of 2.1 billion bushels.
Wheat prices gained a modest 1% during the first quarter of 2011.
The U.S. was the world’s biggest exporter of corn, soybeans and wheat last year.
Corn is the biggest U.S. crop, valued at USD66.7 billion in 2010, followed by soybeans at USD38.9 billion, government figures show. Wheat was fourth at USD13 billion, behind hay.
In the week ahead, grain traders will continue to monitor weather conditions in South America and the U.S.
Forexpros
