US corn futures fell to a nine-month low Thursday on continued technical selling and fund liquidation, while soyabeans hit a 10-month low on worries that bird flu cases in China may slow feed demand there, traders said. Wheat was lower in choppy trade but rumours of Chinese purchases of US soft wheat underpinned the market.
At the Chicago Board of Trade at 2:16 pm CDT (1916 GMT), May corn was down 11-1/2 cents at $6.30 per bushel after falling to $6.27, the lowest spot corn price since June 25. May soyabeans were down 8-1/4 cents at $13.72 per bushel after dipping to $13.61, the lowest spot soyabean price since June 6. May wheat was down 2-1/2 cents at $6.94 a bushel.
Corn posted the biggest declines on a percentage basis. The market’s move appeared mostly technical with sales accelerating as front-month May corn fell below Tuesday’s low of $6.34. The corn market has been in liquidation mode since March 28, when the US Department of Agriculture reported larger-than-expected US grain stockpiles.
“With May and July taking out the recent lows, that’s a very negative technical signal. People who have been trying gently to buy this market and maybe find a bottom – you’ve wrecked those ideas,” said Terry Linn, analyst with the Linn Group in Chicago. The May and July corn contracts also lost ground to new-crop December as traders scrambled to exit old crop/new crop spread positions.
Corn and soyabeans were under pressure from fears that bird flu might spread in China, reducing demand for soyabeans and soyameal, a key ingredient in chicken feed. China is the world’s biggest soyabean buyer. The developments weighed on markets even though the immediate impact on the country’s poultry sector was unclear. “It’s more psychological, more than having any impact on the actual supply and demand for feed and meal,” said Anne Frick, oilseeds analyst with Jefferies Bache in New York.
China said in Thursday it was mobilising resources to combat a new strain of bird flu that has killed five people, as Japan and Hong Kong stepped up vigilance against the virus and Vietnam banned imports of Chinese poultry. Still, some analysts said China was importing less soya than a year ago, and Chinese imports could fall short of the US Department of Agriculture’s forecast.