US grain and soyabean futures slid sharply on Monday along with many other commodities as disappointing economic growth in China triggered selling, with Chicago wheat falling the most in two weeks. Commodity markets were rattled by official data showing that economic growth in China slowed in the first three months of 2013 to 7.7 percent, from 7.9 percent in the previous quarter.
“The big story is gold is suffering some sharp losses, the crude market’s down, everything’s down,” said Karl Setzer, analyst for MaxYield Co-operative. “We’re just not seeing any bullish news come through this market today at all.” Concerns about China, the world’s top consumer of raw materials, hit the grain markets, which were already reeling from forecasts that supplies will rebound this year after weather-hit harvests in several major producing countries during 2012.
In a sign of this bearish outlook, large speculators cut their net long positions in Chicago Board of Trade corn and soyabean futures, leaving them with their biggest net short position in corn since June 2010. Wheat fell the most on Monday, giving up all of a 2.4 percent gain on Friday that was linked to weather worries and Chinese interest in importing US wheat.
CBOT May wheat fell 2.9 percent, or 21 cents, to $6.93-3/4 a bushel, tumbling through key support levels at the 30-day and 40-day moving averages. May corn dropped 1.8 percent, or 11-3/4 cents, to $6.46-3/4, and May soyabeans gave up 1.3 percent, or 18 cents, to $13.95 after Friday’s two-week peak of $14.19.
The US Department of Agriculture on Monday reported the sale of 480,000 tonnes of US soft red winter wheat to China for the new marketing year 2013/14, but the market shrugged off the widely expected sale. Wheat rose last week amid concerns the US hard red winter wheat crop would be damaged by a recent bout of wintry weather. After markets closed, the USDA said 36 percent of the US winter wheat crop was in good or excellent condition as of Sunday, unchanged from a week ago, and far short of the 64 percent in such shape a year ago. “We’ve seen wheat bounce back many times and the general assumption right now is some damage took place, but just how much is a bit uncertain and will come out in the days ahead,” said Shawn McCambridge, grains analyst with Jefferies Bache in Chicago.
