By Kirk Maltais
-- Soybeans for May delivery fell 2.2% to $14.80 3/4 a bushel on the Chicago Board of Trade on Tuesday, feeling pressure as the Brazilian harvest appears to be well under way.
-- Corn for May delivery dropped 2.1% to $6.30 1/2 a bushel.
-- Wheat for May delivery slipped 0.4% to $7.07 1/4 a bushel.
HIGHLIGHTS
Progress Pressure: Soybean and soymeal futures led the CBOT down Tuesday, with soymeal closing off 3.2%. The move was in reaction to Brazil's headway in harvesting.
"Despite recent rains, many areas have made significant progress with regard to soybean harvest and corn planting," DTN said in a note.
Dry conditions are still present in Argentina, but trader focus is more on the flow of grains entering the export market from Brazil.
Multi-Year Low: Wheat futures hit their lowest level since September 2021 on Tuesday. The contract has fallen nearly 11% in the past two weeks, with traders seen as attempting to find a short-term bottom for prices.
"Wheat appears to me to be capitulating-throwing in the towel and pushing HRW down for a fifth straight month," Mike Zuzolo of Global Commodity Analytics told the WSJ. "Even though the crude [oil] is higher & the Kansas/Colorado/Nebraska wheat conditions fell again in February."
Export demand also appears to be growing as futures sink, he adds.
Grown Stale: Trader liquidation came in part from a lack of fresh news for the grains complex, with last week's USDA Agricultural Outlook Forum not moving the needle.
"A stale news environment and technical breakdown last week has managed funds liquidating long positions," said Doug Bergman of RCM Alternatives in a note. "The market is due for a bounce, but the market thus far is not showing any major sign that it is ready to stop dropping."
INSIGHT
Stiff Competition: Wheat prices have been declining world-wide "probably due to the good supply situation, thanks in part to a sharp rise in Russian exports," said Commerzbank in a note.
Consultancy firm SovEcon forecasts record Russian wheat exports of 44.2 million tons for the period from February to June.
What is also in focus is the Black Sea Grains Initiative, which is currently set to expire on March 19.
Traders are optimistic the deal will be extended, said Commerzbank.
Backtracking: U.S. farm incomes in 2023 are expected to give back much of the gains made in 2022, said American Farm Bureau Federation President Zippy Duvall in testimony to the House of Representatives' Committee on Agriculture.
"Much uncertainty remains related to the ability of farmers and ranchers to access affordable supplies and deal with regulatory and weather-related challenges," Mr. Duvall said in written testimony. "Expected revenue declines that more than erase gains made during 2022."
AHEAD
-- The EIA is scheduled to release its weekly ethanol production and stocks report at 10:30 a.m. EST Wednesday.
-- The USDA is due to release its monthly grain crushings report at 3 p.m. EST Wednesday.
-- Hormel Foods Corp. is scheduled to release its first-quarter earnings report at 6:30 a.m. EST Thursday.
-- The USDA is due to release its weekly export sales report at 8:30 a.m. EST Thursday.
Write to Kirk Maltais at kirk.maltais@wsj.com
(END) Dow Jones Newswires
02-28-23 1556ET
