By Jesse Newman
CHICAGO--Grain and soybean futures slid Monday amid a surging U.S. dollar and widespread selling in agricultural markets.
Wheat prices fell to a two-month low, dropping below the psychologically-significant $4 a bushel mark due to strength in the dollar, which can dampen export demand for U.S. crops like wheat by making them more expensive for overseas importers.
The rising dollar, which climbed 1% in midday trade, comes as the world is awash in wheat and U.S. stockpiles are projected to swell to a nearly 30-year high next year. That worries traders who see domestic grain supplies becoming less competitive on the world market as rival producers offer cheaper wheat win export business.
"If the dollar continues to move upward against the euro and emerging currencies, the wheat is going to suffer," said Charlie Sernatinger, head of grain trading for head of grains trading at ED&F Man Capital Markets.
Wheat futures for December dropped 9 cents, or 2.2%, to $3.94 a bushel at the Chicago Board of Trade, the lowest closing price since Sept. 14.
Lower wheat futures pressured the corn market, with concerns growing that inexpensive wheat prices would edge out corn in animal feed rations. Corn prices fell to a one-month low, under further pressure from the U.S. harvest, which is drawing to a close. U.S. farmers are nearly done collecting what is forecast to be the biggest-ever crop, adding to already ample U.S. and global supplies of the grain.
CBOT December corn futures slid 3 cents, or 0.9%, to $3.37 1/4 a bushel, the lowest settlement price since Oct. 12.
Soybean prices also dropped to a one-month low, pressuredin part by lower prices for soybean oil, a vegetable oil made from the crop. Grain traders are on the lookout for signs of crop problems in South America, which could boost prices for the oilseeds, though improving conditions in some regions are allowing growers there to get crops planted, analysts said.
CBOT soybeans declined 7 1/2 cents, or 0.8%, to $9.71 a bushel, the lowest closing price since Oct. 14.
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(END) Dow Jones Newswires
November 14, 2016 15:50 ET (20:50 GMT)
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