Corn drags down markets, except soybeans

Monday was a dreary day in the grain markets, with corn reaching a new low for the year.

China spooked the markets by rejecting a shipment of U.S. corn that allegedly contained an unapproved genetic modification, a Syngenta variety, according to Reuters.

Corn futures fell nine to 10 cents per bushel, wheat classes fell one to four cents and canola fell 11 to13 cents per bu.

Soybeans had a moderately positive day, breaking from most other crops, gaining seven to nine cents in futures contracts.

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While corn remained under pressure because of the Friday announcement that the U.S. Environmental Protection Agency hopes to cut the 2014 grain ethanol requirement to 13 billion bu. from the 14.4 billion required this year, much of the downward pressure came from worries about Chinese demand.

The rejection of one cargo of corn by China due to legitimate GMO concerns is not enough to rock the market by itself, but the event raises all the fears about Chinese demand that have been haunting grain markets in recent weeks.

China is believed to often use non-tariff mechanisms to reduce imports, so some analysts worry that the corn rejection could mean China is attempting to hit the brakes in its high-speed crop imports so far this crop year. If the concern over the GMO content of the corn is just an excuse to limit imports, it could be a sign that China is beginning to back away from its recent aggressive buying.

Chuck Penner of LeftField Commodity Research said analysts have trouble assessing how much of China’s recent purchasing is due to heavy consumption within China and how much is due to restocking.

“How much of this buying that they’re doing is getting processed right away and how much is just going into warehouses?” said Penner.

The more that is being processed, the better the prospects for continuing sales. But if most is just refilling depleted stockpiles, the buying can’t continue.

“Once they’re full, they’ll stop buying and that’s that point that’s hard to read,” said Penner.

U.S. stock markets were more cheerful early on Monday, reaching round-number levels that made for many headlines and news reports, with the Dow Jones Industrial Average rising above 16,000 for the first time and the Standard and Poors 500 rising above 1,800 for the first time as well.

However, by late in the day both of those peaks had been lost and those stock markets were back below their open at 3 p.m. Monday.

Winnipeg ICE Futures Canada dollars per tonne

Canola Jan 2014    483.20    -5.70    -1.17%
Canola Mar 2014    492.40    -5.00    -1.01%
Canola May 2014    500.50    -4.70    -0.93%
Canola Jul 2014    506.50    -4.40    -0.86%
Canola Nov 2014    510.00    -4.90    -0.95%

Milling Wheat Dec 2013    215.00    -1.00    -0.46%
Milling Wheat Mar 2014    226.00    -1.00    -0.44%
Milling Wheat May 2014    234.00    -1.00    -0.43%

Durum Wheat Dec 2013    247.00    unch    0.00%
Durum Wheat Mar 2014    253.00    unch    0.00%
Durum Wheat May 2014    257.00    unch    0.00%

Barley Dec 2013    152.00    unch    0.00%
Barley Mar 2014    154.00    unch    0.00%
Barley May 2014    155.00    unch    0.00%

American crop prices in cents US/bushel, soybean meal in $US/short ton, soy oil in cents US/pound

Chicago
Soybeans Jan 2014    1287.5    +7    +0.55%
Soybeans Mar 2014    1273.25    +7.5    +0.59%

Soybeans May 2014    1259.5    +9.25    +0.74%
Soybeans Jul 2014    1255    +10    +0.80%
Soybeans Aug 2014    1235.25    +6.75    +0.55%
Soybeans Sep 2014    1187    +1.5    +0.13%

Soybean Meal Dec 2013    415.8    +5.3    +1.29%
Soybean Meal Jan 2014    410.5    +4.8    +1.18%
Soybean Meal Mar 2014    401.6    +5.1    +1.29%

Soybean Oil Dec 2013    40.11    -0.36    -0.89%
Soybean Oil Jan 2014    40.37    -0.37    -0.91%
Soybean Oil Mar 2014    40.77    -0.35    -0.85%

Corn Dec 2013    412    -10    -2.37%
Corn Mar 2014    421    -9.5    -2.21%
Corn May 2014    429.25    -9.25    -2.11%
Corn Jul 2014    436.75    -9    -2.02%
Corn Sep 2014    443    -8.75    -1.94%

Oats Dec 2013    344    +1    +0.29%
Oats Mar 2014    321.25    -2    -0.62%
Oats May 2014    312.25    +1    +0.32%
Oats Jul 2014    309    +2    +0.65%
Oats Sep 2014    309.5    +2    +0.65%

Wheat Dec 2013    642.25    -2.25    -0.35%
Wheat Mar 2014    652.5    -2    -0.31%
Wheat May 2014    656    -2.5    -0.38%
Wheat Jul 2014    652.75    -3    -0.46%
Wheat Sep 2014    660.75    -3.25    -0.49%

Minneapolis
Spring Wheat Dec 2013    695.25    -1.5    -0.22%
Spring Wheat Mar 2014    705    -1.5    -0.21%
Spring Wheat May 2014    712.75    -1.75    -0.24%

Spring Wheat Jul 2014    719    -2.25    -0.31%
Spring Wheat Sep 2014    722.5    -2.75    -0.38%

Kansas City
KCBT Red Wheat Dec 2013    694    -4.25    -0.61%
KCBT Red Wheat Mar 2014    696.5    -3.75    -0.54%
KCBT Red Wheat May 2014    696.5    -2.75    -0.39%
KCBT Red Wheat Jul 2014    688    -2.75    -0.40%
KCBT Red Wheat Sep 2014    698.5    -2    -0.29%

Light crude oil nearby futures in New York dropped 81 cents at $93.03 US per barrel.
The Canadian dollar at noon was 95.90 cents US, up from 95.62 cents the previous trading day. The U.S. dollar at noon was $1.0427 Cdn.